TCREUR_Public/100531.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

                           E U R O P E

              Monday, May 31, 2010, Vol. 11, No. 105

                            Headlines



B E L G I U M

TRUVO SUBSIDIARY: Moody's Cuts Corporate Family Rating to 'Ca'


G E R M A N Y

ARCANDOR AG: Karstadt Unit Receives Three Binding Bids
COGNIS GMBH: Fitch Changes Outlook to Stable; Affirms 'B' Rating
DRETTMANN GMBH: Declining Yacht Prices Prompt Insolvency Request
DUERR AG: S&P Downgrades Long-Term Corporate Credit Rating to 'B'
GENERAL MOTORS: Germany to Decide on Opel State Aid by June 10


H U N G A R Y

HUNGARIAN STATE: S&P Downgrades Corporate Credit Rating to 'B+'
MALEV ZRT: May Be Forced Into Bankruptcy to Avoid Debt Repayment


I R E L A N D

ANGLO IRISH: ODCE Inquiries to Take Months to Finish
CAISEAL MARA: Bank of Scotland Appoints Receiver
CORIOLANUS LTD: Moody's Cuts Rating on Series 30 Notes to 'Ba1'
CORIOLANUS LTD: Moody's Lifts Rating on Series 76 Notes to Ba1
ERC IRELAND: Moody's Downgrades Corporate Family Rating to 'B2'

RAHAXI INC: Posts US$1.5 Million Net Loss in Q3 Ended March 31
WEXFORD RENAULT: Provisional Liquidator Appointed


K A Z A K H S T A N

BTA BANK: Creditors Back Debt Restructuring Plan


L U X E M B O U R G

ORCO PROPERTY: Loss Narrows to EUR15.6 Million in First Qtr. 2010


R O M A N I A

DIVERTA: Owner Files for Insolvency & Eyes Reorganization


R U S S I A

ALFA BANK: Fitch Upgrades Long-Term IDR to 'BB' From 'BB-'
MDM BANK: Fitch Upgrades Long-Term IDR to 'BB' From 'BB-'
NOMOS BANK: Fitch Upgrades Long-Term IDR to 'BB-' From 'B+'


S L O V E N I A

ISTRABENZ GROUP: Back to Profit in Q1 on Higher Asset Value


S P A I N

PRIVATE MEDIA: Recurring Losses Prompt Going Concern Doubt

* SPAIN: To Tighten Banks' Bad Loan Provisioning Rules


U K R A I N E

LEHMAN BROTHERS: Ukraine Stocks Plunge Most Since Lehman Collapse


U N I T E D   K I N G D O M

BARCUD DERWEN: May Face Administration If Buyer Not Found
EMI GROUP: Terra Firma Mulls Stake Sale in Music Publishing Unit
GARNER: John Moulton & Pierce Casey Snap Up Business
HIGHLAND AIRWAYS: Owes Creditors GBP3.2 Million
ITV PLC: S&P Changes Outlook to Stable; Affirms Low-B Ratings

ONCO PETROLEUM: Receiver Eyeing Ex-Owner's Michigan Assets
SANDWELL COMMERCIAL: Fitch Affirms 'CCC' Rating on Class E Notes


X X X X X X X X

* BOND PRICING: For the Week May 17 to May 21, 2010





                         *********


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B E L G I U M
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TRUVO SUBSIDIARY: Moody's Cuts Corporate Family Rating to 'Ca'
--------------------------------------------------------------
Moody's Investors Service has downgraded the Corporate Family
Rating of Truvo Subsidiary Corp to Ca from Caa3, and its
Probability of Default Rating to Ca from Caa2.  At the same time,
Moody's downgraded to C from Ca the ratings of the EUR395 million
and US$200 million senior notes due 2014 issued by Truvo.  The
outlook for all the ratings is stable.

The rating action reflects Moody's concerns in relation to the
company's capital structure, which Moody's considers
unsustainable, and therefore the risk associated with the
uncertainty over how Truvo will ultimately decide to strengthen
its credit profile in conjunction with reducing its overall debt
burden, which may include the possibility of a distressed
exchange, in the very near term.

Moody's also noted that Truvo management in its Q1 2010 results
stated that it could give no assurances that the interest payments
due on June 1, 2010, or subsequently would be paid, or on the
outcome of debt restructuring negotiations.

The Ca CFR continues to incorporate Moody's expectation of below-
average (i.e. in the 30% range) family recovery.  The instrument
ratings of C (LGD6) on the senior notes due 2014 have been derived
using Moody's LGD methodology, and reflects Moody's expectation of
very low recovery on the notes.

The last rating action was implemented on December 16, 2009,
when Moody's downgraded Truvo's CFR to Caa3 from Caa2; its PDR
to Caa2 from Caa1; and the ratings on the EUR395 million and
US$200 million senior notes due 2014 to Ca from Caa3.

Truvo's ratings were assigned by evaluating factors Moody's
believe are relevant to the credit profile of the issuer, such as:
(i) the business risk and competitive position of the company
versus others within its industry; (ii) the capital structure and
financial risk profile of the company; (iii) the projected
performance of the company over the near to intermediate term; and
(iv) management's track record and tolerance for risk.  These
attributes were compared against other issuers both within and
outside Truvo's core industry and Truvo's ratings are believed to
be comparable with those of other issuers with similar credit
risk.

Truvo Intermediate Corp., the parent of Truvo Subsidiary Corp.,
is, through its subsidiaries, the leading directory publisher in
Belgium and Ireland.  Through its joint venture with Portugal
Telecom, the company is the leading directory publisher in
Portugal and, through its minority interests, holds leading
positions in the directory markets in South Africa and Puerto
Rico.


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G E R M A N Y
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ARCANDOR AG: Karstadt Unit Receives Three Binding Bids
------------------------------------------------------
Holger Elfes at Bloomberg News reports that Karstadt, Arcandor
AG's insolvent German department-store chain, received three
binding bids from investors before Friday's deadline.

According to Bloomberg, Thomas Schulz, spokesman for administrator
Klaus Hubert Goerg, said in an interview Friday that the offers
came from private equity company Triton, investment firm Berggruen
Holdings Ltd. and the Highstreet partnership, which owns most of
Karstadt's real estate.

Spokespeople for Highstreet and Berggruen confirmed the offers,
while declining to discuss details, Bloomberg notes.

                         About Arcandor AG

Germany-based Arcandor AG (FRA:ARO) -- http://www.arcandor.com/--
formerly KarstadtQuelle AG, is a tourism and retail group.  Its
three core business areas are tourism, mail order services and
department store retail.  The Company's business areas are covered
by its three operating segments: Thomas Cook, Primondo and
Karstadt.  Thomas Cook Group plc is a tour operator with
operations in Europe and North America, set up as a result of a
merger between MyTravel and Thomas Cook AG.  It also operates the
e-commerce platform, Thomas Cook, supporting travel services.
Primondo has a portfolio of European universal and specialty mail
order companies, including the core brand Quelle.  Karstadt
operates a range of department stores, such as cosmopolitan
stores, including KaDeWe (Kaufhaus des Westens), Karstadt
Oberpollinger and Alsterhaus; Karstadt brand department stores;
Karstadt sports department stores, offering sports goods in a
variety of retail outlets, and a portal, karstadt.de that offers
online shopping, among others.

As reported by the Troubled Company Reporter-Europe, a local court
in Essen formally opened insolvency proceedings for Arcandor on
September 1, 2009.  The proceedings started for the Arcandor
holding company and for 14 units, including the Karstadt
department-store chain and Primondo mail-order division.

Arcandor filed for bankruptcy protection after the German
government turned down its request for loan guarantees.  On
June 8, 2009, the government rejected two applications for help by
the company, which employs 43,000 people.  The retailer sought
loan guarantees of EUR650 million (US$904 million) from Germany's
Economy Fund program.  It also sought a further EUR437 million
from a state-owned bank


COGNIS GMBH: Fitch Changes Outlook to Stable; Affirms 'B' Rating
----------------------------------------------------------------
Fitch Ratings has revised Germany-based chemicals company Cognis
GmbH's Outlook to Stable from Negative.  Its Long-term Issuer
Default Rating has been affirmed at 'B'.  The instrument rating
actions applicable to Cognis and related entities are:

Cognis GmbH

  -- Super senior secured revolving credit facility: affirmed at
     'BB'; 'RR1'

  -- Senior secured floating-rate notes and loans: upgraded to
     'BB-' from 'B+'; Recovery Rating revised to 'RR2' from 'RR3'

  -- High-yield notes: affirmed at 'CCC'; 'RR6'

Cognis Holding GmbH

  -- PIK loans: affirmed at 'CC'; 'RR6'

The Outlook revision reflects Fitch's improved expectations for
the remainder of 2010 following the recovery observed since the
end of FY09.  This is despite limited visibility, especially for
H210, and uncertainties with regards to European markets and the
development of raw material prices.  For Q110, Cognis reported
strong results, pointing to a continued recovery across business
units and geographies.  This followed significantly better results
for 2009 than previously expected.  Volume in Q110 grew by 14.2%
y-o-y returning to Q108 levels while sales increased 10.6% y-o-y
to EUR728 million.  Reported EBITDA almost doubled to EUR130
million, benefiting from higher capacity utilization and still
moderate raw material cost increases.  Cognis reports a strong
recovery in Europe, particularly in France and Germany, while
emerging markets, including Asia Pacific, maintained strong growth
rates.

Fitch expects Cognis could achieve a 25% higher unadjusted EBITDA
in FY10 and positive free cash flow, albeit substantially below
the record levels seen in FY09 which had been driven by a
substantial decrease in working capital.  This would result in a
reduction in cash-pay net debt/EBITDAR leverage to 4.2x in FY10
from 4.9x in FY09.

Cognis benefits from having procured long-term funding with
favorable terms in May 2007, prior to the onset of the global
financial crisis.  The company has a largely back-ended debt
profile with first major maturities in September 2013.  Moreover,
Cognis had very good liquidity comprising EUR338 million in cash
reserves as per March 2010 and approximately EUR201 million of
undrawn revolving facilities.

The revision of the senior secured FRN/FRL Recovery Ratings to
'RR2' follows Cognis' significant achievement of approximately
EUR100 million in operational restructuring and cost saving
measures undertaken during 2009.  The agency has increased its
estimation of Cognis' hypothetical post-restructuring EBITDA due
to related permanent cost savings, resulting in Fitch's
expectation of superior recovery prospects albeit in the low end
of the 'RR2' range.

A reversal of the positive volume trends, severely impacting sales
and earnings, and consistently weaker credit metrics could lead to
a negative rating action.  A positive rating action could result
from a sustainable reduction in lease-adjusted cash-pay net debt/
EBITDAR leverage to below 4x.

Cognis is owned by private equity funds advised by Permira, GS
Capital Partners and SV Life Sciences.  Following the completed
disposal of two non-core divisions, oleo chemicals and process
chemicals in 2008, the company operates three main divisions: care
chemicals, nutrition and health and functional products.  These
three divisions generated LTM revenues of EUR2,653 million and
unadjusted LTM EBITDA of EUR386 million as per March 2010.


DRETTMANN GMBH: Declining Yacht Prices Prompt Insolvency Request
----------------------------------------------------------------
SuperYachtTimes.com reports that Drettmann GmbH's management
applied on May 25 for opening of insolvency proceedings.

According to the report, the step is a reaction of the management
to the decline in the prices in the used yacht section, concerning
especially foreign brands.  The target of this measure is a
reorganization of the company and the safeguarding of jobs, the
report notes.

Drettmann GmbH is yacht builder and dealer based in Bremen.


DUERR AG: S&P Downgrades Long-Term Corporate Credit Rating to 'B'
-----------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its long-term
corporate credit rating on Germany-based paint and assembly
systems manufacturer Duerr AG to 'B' from 'B+'.  The outlook is
negative.

At the same time, S&P lowered the rating on the senior
subordinated notes issued by Duerr to 'CCC+' from 'B-'.  S&P's '6'
recovery rating on this debt remains unchanged, indicating its
expectation of negligible (0%-10%) recovery for lenders in the
event of a payment default.

"The rating action reflects S&P's view that Duerr's weak and
volatile operating performance will curtail its ability to
generate cash and prevent it from achieving financial measures
that S&P considers consistent with the previous 'B+' rating," said
Standard & Poor's credit analyst Varvara Nikanorava.  In 2009,
Duerr's operating performance was poor, primarily due to weak
operating conditions, such as poor demand for equipment that Duerr
provides to auto manufacturers.  This was in spite of the cost-
cutting measures that management was quick to initiate.  S&P
considers it uncertain whether the recent improvement in demand in
the industry can be sustained.  S&P believes that prospects for
2010 and beyond will be linked to both macroeconomic and
structural factors in the auto industry, which may delay
automakers' expansionary plans.

S&P understands further that Duerr has to refinance both a EUR100
million maturing bond and its revolving credit facility (RCF) by
July 2011.  While S&P assume this will be successful, the negative
outlook reflects its view that there are potentially risks related
to such bulky transactions given uncertain and possibly
unfavorable capital market conditions, and in light of the still
fragile demand recovery witnessed over the past few quarters.

S&P's 2010 base-case assumes a modest recovery of Duerr's revenues
and earnings, owing to cost savings as well as meaningful growth
in emerging markets such as China, Brazil, and Eastern Europe,
markets in which the company is currently deriving most of its
order growth.  However, S&P think that a quick recovery of the
credit measures to the levels commensurate with the previous
rating is not likely.

"The negative outlook on Duerr reflects S&P's view of the mounting
refinancing risk regarding its bond and revolving credit facility
in light of the fragile recovery in demand," said Ms.  Nikanorava.
"It also reflects S&P's view of Duerr's currently weak
profitability and its uncertainty regarding its ability to
generate positive FOCF in 2010."


GENERAL MOTORS: Germany to Decide on Opel State Aid by June 10
--------------------------------------------------------------
John Reed at The Financial Times reports that Nick Reilly, head of
General Motors' European business, expects the German government
to decide on a loan guarantee for the carmaker's Opel/Vauxhall
division by June 10.

According to the FT, Mr. Reilly also said that he had written to
Vince Cable, Britain's new business secretary, requesting a
meeting, adding that he had "no indication" that the UK would back
off from the previous government's decision to provide a loan
guarantee worth GBP270 million (US$392.5 million) for GM's
European business.

The FT relates Mr. Reilly said that the committee making a
recommendation on the guarantees would meet again next Monday.  It
would then write a report for a second committee due to make final
recommendations to Germany's government, which would probably meet
and make a final decision the following week, the FT notes.

As reported by the Troubled Company Reporter-Europe on May 25,
2010, Bloomberg News said that GM reached an agreement with Opel's
workers to cut labor spending by EUR265 million (US$331 million) a
year to help finance a reorganization of the unprofitable unit.
Bloomberg disclosed Opel said in an e-mailed statement on May 21
that unions agreed to waive one-time payments, postpone a planned
2.7% salary increase, and reduce Christmas and vacation bonuses by
50% for two years.

On May 28, 2010, the Troubled Company Reporter-Europe, citing
Bloomberg News, reported that GM will cover a pledge to increase
funding for the reorganization of its Opel unit with loans and a
deposit guarantee.  GM won't provide Opel with additional cash and
will instead give two loans totaling EUR1.06 billion (US$1.3
billion) and provide EUR245 million of collateral for government
aid to reach the EUR1.9 billion it has offered, Bloomberg
disclosed, citing a PricewaterhouseCoopers report commissioned by
the German government.  According to Bloomberg, a panel advising
the German government on distributing loans and aid to companies
under reorganization began deliberations on GM's request on May
25.  A final decision on state aid for Opel will be made by the
government's steering committee, which includes representatives
from Ms. Merkel's office and the economic, finance and justice
ministries, Bloomberg said.

                       About General Motors

General Motors Company -- http://www.gm.com/-- is one of the
world's largest automakers, tracing its roots back to 1908.  With
its global headquarters in Detroit, GM employs 209,000 people in
every major region of the world and does business in some 140
countries.  GM and its strategic partners produce cars and trucks
in 34 countries, and sell and service these vehicles through these
brands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel,
Vauxhall and Wuling.  GM's largest national market is the United
States, followed by China, Brazil, the United Kingdom, Canada,
Russia and Germany.  GM's OnStar subsidiary is the industry leader
in vehicle safety, security and information services.

GM acquired its operations from General Motors Company, n/k/a
Motors Liquidation Company, on July 10, 2009, pursuant to a sale
under Section 363 of the Bankruptcy Code.  Motors Liquidation or
Old GM is the subject of a pending Chapter 11 reorganization case
before the U.S. Bankruptcy Court for the Southern District of New
York.

At December 31, 2009, GM had total assets of US$136.295 billion
against total liabilities of US$107.340 billion.  At December 31,
2009, total equity was US$21.249 million.

                   About Motors Liquidation

General Motors Corporation and three of its affiliates filed for
Chapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead Case
No. 09-50026).  General Motors changed its name to Motors
Liquidation Co. following the sale of its key assets to a company
60.8% owned by the U.S. Government.

The Honorable Robert E. Gerber presides over the Chapter 11 cases.
Harvey R. Miller, Esq., Stephen Karotkin, Esq., and Joseph H.
Smolinsky, Esq., at Weil, Gotshal & Manges LLP, assist the Debtors
in their restructuring efforts.  Al Koch at AP Services, LLC, an
affiliate of AlixPartners, LLP, serves as the Chief Executive
Officer for Motors Liquidation Company.  GM is also represented by
Jenner & Block LLP and Honigman Miller Schwartz and Cohn LLP as
counsel.  Cravath, Swaine, & Moore LLP is providing legal advice
to the GM Board of Directors.  GM's financial advisors are Morgan
Stanley, Evercore Partners and the Blackstone Group LLP.

Bankruptcy Creditors' Service, Inc., publishes General Motors
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by General Motors Corp. and its various affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)


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H U N G A R Y
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HUNGARIAN STATE: S&P Downgrades Corporate Credit Rating to 'B+'
---------------------------------------------------------------
Standard & Poor's Ratings Services said it lowered its long-term
corporate credit rating on vertically integrated rail entity
Hungarian State Railways Co. Ltd. to 'B+' from 'BB'.  S&P also
revised the CreditWatch implications on the company to developing
from negative.  The short-term rating remains at 'B'.

"The downgrade follows S&P's downward revision of MAV's stand-
alone credit profile to 'CCC+' from the 'B' category together with
its view of MAV's "very weak" liquidity situation on a stand-alone
basis, that is, excluding expectations of extraordinary government
support," said Standard & Poor's credit analyst Timon Binder.

S&P analyzes MAV using its criteria for government-related
entities.  The 'B+' long-term rating on MAV reflects Standard and
Poor's opinion that there is a "very high" likelihood that the
Republic of Hungary (BBB-/Stable/A-3) would provide timely and
sufficient extraordinary support to MAV in the event of financial
distress.

The rating also reflects S&P's assessment of MAV's SACP, which S&P
now considers to be 'CCC+' from the 'B' category previously.  S&P
views MAV's business risk profile as "weak" given its weak
profitability, owing to what S&P view as insufficient ongoing
government support and lack of clarity regarding the level of such
support in the future.  S&P classify MAV's financial risk profile
as "highly leveraged" given its very low cash flow generation
capacity and its weak capital structure, which according to the
management might need to be rebalanced with a capital injection in
2011.

S&P understands that MAV will have to cover material cash needs in
2010 with short-term credit lines.  S&P views MAV's financial
policy as "very aggressive" because S&P believes its extensive use
of short-term liquidity lines increases MAV's refinancing risk.

S&P notes that MAV needs to use short-term credit lines because it
is not sufficiently compensated by the government to maintain the
network and is generating losses.  Although MAV and the government
signed a three-year purchase agreement for public transportation
services in 2009, the network management contract is still
pending.

"S&P expects to be able to resolve the CreditWatch listing within
the next three months, following discussions with the new
Hungarian government to gain greater visibility on its strategy
for MAV and the level and type of extraordinary support the
government will provide," said Mr. Binder.  "S&P aims to determine
the timeframe for the implementation of the network management
contract between MAV and the state as well as any measures to
improve MAV's current liquidity situation and capital structure."

As a result of its discussions, S&P might reassess its expectation
of the level and timeliness of extraordinary government support to
MAV and therefore its view of the link and/or role of MAV for the
government.  This may lead us to lower the rating on MAV.
However, S&P may raise the rating if S&P sees that the company's
very weak liquidity situation strengthens, the contract with the
government is implemented, and the company's overall SACP
improves.


MALEV ZRT: May Be Forced Into Bankruptcy to Avoid Debt Repayment
----------------------------------------------------------------
Zoltan Simon at Bloomberg News, citing Nepszabadsag, reports that
Hungarian airline Malev Zrt. may be forced into bankruptcy by the
incoming government to free it from debt.

According to Bloomberg, the newspaper said bankruptcy would help
avoid having to repay EUR100 million (US$123 million) Malev, which
was renationalized this year, owes the Russian state development
bank Vnesheconombank.

Bloomberg notes Nepszabadsag said a third of the amount is
contested by Hungary.


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I R E L A N D
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ANGLO IRISH: ODCE Inquiries to Take Months to Finish
----------------------------------------------------
Colm Keena at The Irish Times reports that Paul Appleby said that
the inquiries he is conducting into matters relating to Anglo
Irish Bank will be finished in "months rather than years".

The Irish Times relates Mr. Appleby was speaking at the
publication of the annual report for 2009 of the Office of the
Director of Corporate Enforcement (ODCE).  According to The Irish
Times, the report states the Anglo inquiry is the most complex
conducted to date by the office, and involves a number of matters
including:

    * the provision by Anglo in 2008 of financial assistance for
the purchase of its shares;

    * matters associated with the loans made by Anglo to its
directors over a number of years, and

    * matters relating to the declared level of customer deposits
at Anglo in 2008.

The ODCE is working in close co-operation with the Garda Bureau of
Fraud Investigation in relation to these matters, The Irish Times
says citing the report.  One third of the ODCE staff is working on
the case, The Irish Times discloses.

"A lot of progress has been made and the investigations are going
well," The Irish Times quoted Mr. Appleby as saying.  "Last year,
the High Court correctly described our evaluation of several
million documents associated with this investigation as 'a
daunting task'.

"The DPP has recently spoken of the complexity of 'white-collar
crime' and the difficulties of pursuing these types of cases.
These statements have introduced an informed note of realism to
the immense challenge which this office and the Garda are facing
in these investigations."

Brian O'Mahony at The Irish Examiner reports Mr. Appleby said the
cost of his investigation into Anglo has hit EUR1 million.

As reported by the Troubled Company Reporter-Europe on May 25,
2010, The Irish Times said that the European Commission is
expected to rule on Anglo Irish Bank's latest restructuring plan
by the end of July.

Anglo Irish Bank Corp PLC -- http://www.angloirishbank.com/--
operates in three core areas: business lending, treasury and
private banking.  The Bank's non-retail business is made up of
more than 11,000 commercial depositors spanning commercial
entities, charities, public sector bodies, pension funds, credit
unions and other non-bank financial institutions.  The Company's
retail deposits comprise demand, notice and fixed term deposit
accounts from personal savers with maturities of up to two years.
Non-retail deposits are sourced from commercial entities,
charities, public sector bodies, pension funds, credit unions and
other non-bank financial institutions.  In addition, at September
30, 2008, its non-retail deposits included deposits from Irish
Life Assurance plc.  The Private Bank offers tailored products and
solutions for high net worth clients and operates the Bank's
lending business in Ireland and the United Kingdom.

                           *     *     *

As reported by the Troubled Company Reporter-Europe on April 7,
2010, Fitch Ratings affirmed Anglo Irish Bank Corporation's lower
Tier 2 subordinated debt downgraded to 'CCC' from 'BBB+'.  Fitch
affirmed the rating on the bank's Upper Tier 2 subordinated notes
at 'CC'.  It also affirmed the rating on the bank's Tier 1 notes
at 'C'.



CAISEAL MARA: Bank of Scotland Appoints Receiver
------------------------------------------------
Eamonn Mac Dermott at Inishowen Independent reports that Caiseal
Mara Hotel has gone into receivership.

According to the report, Seamus Farren of Farren Roarty has been
appointed receiver to Gallagher's Hotel in Letterkenny and Caiseal
Mara Hotel by Bank of Scotland.

"The company has gone into receivership but we would like to
stress that this will not affect the running of the hotel," the
report quoted Mark Langford, one of the hotel managers, as saying.
"It is very much business as usual here and the hotel is being run
as a going conern by Seamus Farren, the receiver.  "There have
been no job losses and there will not be any job losses and, if
anything, business is doing really well."

Caiseal Mara Hotel is located in Moville, Ireland.  It employs 30
people.


CORIOLANUS LTD: Moody's Cuts Rating on Series 30 Notes to 'Ba1'
---------------------------------------------------------------
Moody's Investors Service took this rating action on notes issued
by Coriolanus Limited Series 30.  The notes affected by the rating
action are:

Issuer: Coriolanus Limited Series 30

  -- Series 30 US$35,000,000 Floating Rate Portfolio Credit Linked
     Secured Notes due 2040, Downgraded to Ba1 on review for
     downgrade; previously on Apr 23, 2009 Confirmed at A2

This transaction is a managed synthetic CDO of 100% US RMBS assets
(nearly 92% Subprime and 8% Prime), of which 68% comprises of 2004
vintages and the rest are of 2005 vintages.  About 51% of the pool
is under review for possible downgrade and stresses have been
applied to approximately 44% of the pool.  Although there have
been significant amortizations to date on the pool and that no
defaults have yet occurred, Moody's note that this transaction has
no cushion to weather any losses on the pool.  Moody's have taken
into consideration the current status of the pool with the
stresses applied and have additionally taken a view that several
underlying 2004 vintages may be performing less well than the
general pre-05 universe.  The transaction will remain on review
for possible downgrade as Moody's continue to monitor the
situation pending further developments in the US RMBS rating
actions.

Moody's explained that in arriving at the rating action noted
above, the ratings of subprime, Alt-A and Option-ARM RMBS which
are currently on review for possible downgrade were stressed.  For
purposes of monitoring its ratings of SF CDOs with exposure to
2005-2007 vintage RMBS, Moody's used certain projections of the
lifetime average cumulative losses as set forth in Moody's press
releases dated January 13th for subprime, January 14th for Alt-A,
and January 27th for Option-ARM.  Based on the anticipated ratings
impact of the updated cumulative loss numbers, the stress varied
based on vintage, current rating, and RMBS asset type.  For
purposes of monitoring its ratings of SF CDOs with exposure to
pre-2005 vintage RMBS, Moody's considered the various factors
indicating continued negative performance that were described in
Moody's press releases dated April 8th for subprime, April 12th
for Option-ARM and April 13th for Alt-A.  Such seasoned deals will
have varying stress based on RMBS asset type.

For 2005 subprime RMBS, those currently rated Aa, A or Baa were
stressed by five notches, Ba rated securities were stressed to
Caa3, and B or Caa securities were treated as Ca.  For subprime
RMBS originated in the first half of 2006, those currently rated
Aaa were stressed by four notches, while Aa, A and Baa rated
securities were stressed by eight notches.  Those securities
currently rated in the Ba range were stressed to Caa3, while
current B and Caa securities were treated as Ca.  For subprime
RMBS originated in the second half of 2006, those currently rated
Aa, A, Baa or Ba were stressed by four notches, currently B rated
securities were treated as Caa3, and currently Caa rated
securities were treated as Ca.  For 2007 subprime RMBS, currently
Ba rated securities were stressed by four notches, currently B
rated securities were treated as Caa3, and currently Caa rated
securities were treated as Ca.

Moody's noted that the stresses applicable to categories of 2005-
2007 subprime RMBS that are not listed above will be two notches
if the RMBS ratings are on review for possible downgrade.

For pre-2005 Alt-A, Aaa rated securities were stressed by four
notches, Aa rated securities by six notches, and A or Baa rated
securities by nine notches.  Pre-2005 Option-ARM securities
currently rated Aaa were stressed by two notches, Aa and A by six
notches, and Baa by nine notches.

For pre-2005 subprime, Aaa and Aa rated securities were stressed
by two notches, A rated securities were stressed by six notches,
and Baa rated securities were stressed by nine notches.

Moody's further explained that these stresses are based on a
preliminary sample analysis of deals from a given vintage and
asset type, and that they will be utilized in its SF CDO rating
analysis while subprime, Alt-A and Option-ARM securities remain on
review for downgrade.  Current public ratings will be used for
securities that have undergone an in depth review by Moody's RMBS
team, and that are no longer on review for downgrade.

In deriving its ratings, Moody's uses the collateral instrument's
current rating-based expected loss, Moody's recovery rate table,
and the original rating of the instrument along with its average
life to infer an unadjusted default probability.  In addition to
the quantitative factors that are explicitly modeled, qualitative
factors are part of rating committee considerations.  These
qualitative factors include the structural protections in each
transaction, the recent deal performance in the current market
environment, the legal environment, and specific documentation
features.  All information available to rating committees,
including macroeconomic forecasts, input from other Moody's
analytical groups, market factors, and judgments regarding the
nature and severity of credit stress on the transactions, may
influence the final rating decision.


CORIOLANUS LTD: Moody's Lifts Rating on Series 76 Notes to Ba1
--------------------------------------------------------------
Moody's Investors Service took these rating actions on notes
issued by Coriolanus Limited, a collateralized debt obligation
transaction referencing a managed portfolio of corporate entities
domiciled in Asia.

Issuer: Coriolanus Limited (Series 73-76)

  -- Series 74 US$50,000,000 Portfolio Credit Linked Floating
     Rate Secured Notes due 2019, Upgraded to A1; previously on
     Aug 12, 2009 Downgraded to A2

  -- Series 75 US$ 50,000,000 Portfolio Credit Linked Floating
     Rate Secured Notes due 2019, Upgraded to Baa1; previously on
     Aug 12, 2009 Downgraded to Baa3

  -- Series 76 US$ 50,000,000 Portfolio Credit Linked Floating
     Rate Secured Notes due 2019, Upgraded to Ba1; previously on
     Aug 12, 2009 Downgraded to Ba3

The rating actions taken are the result of the determination of
recovery for three credit events that affect 11% of initial
portfolio notional amount.

The recovery was significantly higher than Moody's average
recovery assumption of 45%, leading to an increase in the
effective credit enhancement to the rated notes compared to
previous assumptions.

The final price on a senior unsecured obligation of a building &
construction company was determined at 98%, and on a senior
secured obligation of a real estate developer, 100%.  Both
entities are domiciled in India.  Their combined exposures account
for 9% of the initial portfolio notional amount.

The final price on a senior unsecured obligation of a beverage
company in China, accounting for 2% of the initial portfolio's
notional amount, was determined at 30%.

Moody's notes that, following prepayment or amortization of some
of the reference obligations, only 57.9% of the initial portfolio
amount is now exposed to corporate reference obligations.  The
protection buyer can replenish the portfolio if relevant criteria,
which include Reference Portfolio Guidelines and Moody's
CDOROM(TM) Model Test, are met.


ERC IRELAND: Moody's Downgrades Corporate Family Rating to 'B2'
---------------------------------------------------------------
Moody's Investors Service downgraded to B2 from B1 the corporate
family rating and probability of default rating of ERC Ireland
Finance Ltd, an indirect parent company of eircom Group Ltd.  At
the same time, Moody's downgraded to Caa1 from B3 the rating of
ERCIF's EUR350 million senior unsecured notes due 2016 and the
rating of the EUR350 million second-lien term loan of ERC Ireland
Holdings Ltd.  The rating of ERCIH's EUR3.3 billion senior secured
facility was downgraded to B1 from Ba3.

These rating actions conclude the review for possible downgrade,
which was initiated on April 20, 2009.  The outlook on the ratings
is negative.

The downgrade reflects Moody's concerns about the combination of
(i) lack of meaningful deleveraging as a result of a weakening
operating performance; and (ii) uncertainties regarding the
overall strategic direction of the company and its long-term
capital structure.

eircom's weakening operating performance trends highlight the
impact of the adverse macroeconomic environment in Ireland, as
well as increasing competitive and regulatory pressures.  As a
result of this weak operating performance, Moody's believes that
there will be no meaningful deleveraging of the company's
financial profile with respect to its original expectations, which
were factored into the previous rating.  Moody's expects that, in
the absence of other measures, the company's adjusted leverage
will remain around 6.0x in FY2010 and FY2011.

While eircom generates positive free cash flow of around
EUR50 million per annum, Moody's notes that this has been
primarily driven by drastic reductions in opex and capex, rather
than improvements in the top line.  In Moody's view, sustained
opex and capex cuts could lead to long-term loss in
competitiveness, as eircom competes with stronger and better
capitalized players such as Vodafone or Telefonica O2.

As a result of the lack of meaningful deleveraging, Moody's
believes that eircom will face increasing challenges in complying
with financial covenants in its facilities documentation in the
short term, because of the covenant step downs in 2010.  If this
occurs, eircom may require an equity injection to rebalance its
capital structure but the company's strategic shareholder, STT
Communications, has not yet given any indication of its intentions
regarding eircom's longer term capital structure.

Absent a potential covenant breach, eircom has no liquidity
pressure in the near term.  As of March 31, 2010, eircom had
EUR265 million in cash and EUR123 million available under its
revolving credit facility.  Debt maturities over the next 12
months are limited to EUR44 million and eircom does not pay
dividends.  The bulk of the maturities is due between 2014 and
2017 for which refinancing will be needed.

The negative outlook on the ratings therefore mainly reflects
Moody's expectation that the company will operate in the near term
with reduced headroom under financial covenants.  Further downward
pressure on the rating could materialize in the absence of a
recovery in operating performance trends resulting in increased
tightening of headroom under financial covenants.

Moody's believes that in the absence of pressure on financial
covenants, eircom would be well positioned in the B2 rating
category with the current leverage metrics and deleveraging
prospects.

The ratings affected by the rating action are:

  - ERCIF's CFR and PDR: downgraded to B2 from B1

  - ERCIF's EUR350 million senior unsecured floating rate notes
    due 2016: downgraded to Caa1 from B3

  - ERCIH's EUR3.3 billion senior secured bank credit facilities:
    downgraded to B1 from Ba3

  - ERCIH's EUR350 million second-lien loan due 2016: downgraded
    to Caa1 from B3

The last rating action was implemented on April 20, 2009, when
Moody's placed the ratings of ERC Ireland Finance Ltd and related
rated entities on review for possible downgrade.

ERC Ireland Finance Ltd (previously known as BCM Ireland Finance
Ltd) and ERC Ireland Holdings Ltd (previously known as BCM Ireland
Holdings Ltd) are holding companies of eircom, the principal
provider of fixed-line telecommunications services in Ireland and,
following its acquisition of Meteor, the third-largest mobile
operator in Ireland.  In the last 12 months ended March 31, 2010,
eircom generated revenues of EUR1,867 million and EBITDA of
EUR679 million.


RAHAXI INC: Posts US$1.5 Million Net Loss in Q3 Ended March 31
--------------------------------------------------------------
Rahaxi, Inc., filed its quarterly report on Form 10-Q, reporting a
net loss of US$1,517,263 on US$1,297,087 of revenue for the three
months ended March 31, 2010, compared with a net loss of
US$3,700,334 on US$1,184,805 of revenue for the same period of
2009.

All of the Company's revenues for the three months ended March 31,
2010, have been generated by its operations outside of the United
States, and its future growth rate is, in part, dependent on
continued growth in international markets.  The Company expects
this to continue through the fiscal year ending June 30, 2010.

The Company's balance sheet as of March 31, 2010, showed
US$2,596,123 in assets, US$7,522,578 of liabilities, for a
stockholders' deficit of US$4,926,455.

RBSM LLP, in New York, expressed substantial doubt about the
Company's financial statements for the fiscal year ended June 30,
2009.  The independent auditors noted that the Company is
experiencing difficulty in generating sufficient cash flow to meet
it obligations and sustain its operations.

The Company had an accumulated deficit of US$119,672,534 as of
March 31, 2010.

A full-text copy of the quarterly report is available for free at:

               http://researcharchives.com/t/s?636a

Rahaxi, Inc. (OTC BB: RHXI) is a provider of electronic payment
processing services, including credit and debit card transaction
processing, point-of-sale related software applications and other
value-added services.  The Company's principal offices are in
Wicklow, Ireland.  The Company also has offices in Helsinki,
Finland and Santo Domingo, the Dominican Republic.  While the
Company's offices in Finland and Ireland will primarily focus on
the European market, the Company's office in the Dominican
Republic will continue to pursue opportunities in the Caribbean
and Latin America, including its recently developed electronic PIN
distribution application for point of sale solutions in
association with some of the most important telecommunications
companies in the Dominican Republic and Haiti.


WEXFORD RENAULT: Provisional Liquidator Appointed
-------------------------------------------------
Gorey Guardian reports that a provisional liquidator was appointed
to Wexford Renault after being hit by the recession.

According to the report, Wexford Renault's directors said the
company has experienced difficult trading conditions over the past
18 months due to a severe decline in the motor trade.

The report notes the directors said in a statement they had made
every effort to restructure Wexford Renault financially to secure
its viability, but the company still found it difficult to
continue and applied on May 21 for the appointment of a
provisional liquidator.

The company will remain open to deal with customer queries and
warranty requests until June 4, the report states.

Wexford Renault is a car sales firm based in Kerlogue Business
Park, Ireland.


===================
K A Z A K H S T A N
===================


BTA BANK: Creditors Back Debt Restructuring Plan
------------------------------------------------
Nariman Gizitdinov at Bloomberg News reports that BTA Bank on
May 28 said in a statement that its creditors approved its debt
restructuring plan.

On March 3, 2010, the Troubled Company Reporter-Europe, citing
Bloomberg News, reported BTA earlier said a court in Kiev,
Ukraine, on February 17 issued a ruling "recognizing" the
legitimacy of its debt restructuring process.  Bloomberg disclosed
BTA also said that on Dec. 22, the High Court of Justice of
England and Wales recognized the bank's restructuring, giving the
bank a suspension of proceedings against its assets.

                         About BTA Bank

BTA Bank AO (BTA Bank JSC), formerly Bank TuranAlem AO --
http://bta.kz/-- is a Kazakhstan-based financial institution,
which is involved in the provision of banking and financial
products for private and corporate clients.

The BTA Group is one of the leading banking groups in the
Commonwealth of Independent States and has affiliated banks in
Russia, Ukraine, Belarus, Georgia, Armenia, Kyrgyzstan and Turkey.
In addition, the Bank maintains representative offices in Russia,
Ukraine, China, the United Arab Emirates and the United Kingdom.
The Bank has no branch or agency in the United States, and its
primary assets in the United States consist of balances in
accounts with correspondent banks in New York City.

As of November 30, 2009, the Bank employed 5,043 people inside
and 4 people outside Kazakhstan.  It has no employees in the
United States.  Most of the Bank's assets, and nearly all its
tangible assets, are located in Kazakhstan.

JSC BTA Bank, also known as BTA Bank of Kazakhstan, filed for
Chapter 15 bankruptcy protection in New York on Feb. 4, 2010
(Bankr. S.D.N.Y. Case No. 10-10638), listing more than US$1
billion in both assets and debt.

On March 9, 2010, the Troubled Company Reporter-Europe, citing
Bloomberg News, reported that JSC BTA Bank was granted relief in
the U.S. under Chapter 15 when the bankruptcy judge in New York
ruled t that the court in Kazakhstan abroad is home to the
"foreign main proceeding."  Consequently, creditor actions in the
U.S. were permanently halted, forcing creditors to hash out their
claims and receive distributions in Kazakhstan, according to
Bloomberg.

BTA Bank is represented in the Chapter 15 proceedings by White &
Case LLP.


===================
L U X E M B O U R G
===================


ORCO PROPERTY: Loss Narrows to EUR15.6 Million in First Qtr. 2010
-----------------------------------------------------------------
Jason Hovet at Reuters reports that Orco Property Group said on
Thursday that the company narrowed its first-quarter loss to
EUR15.6 million from EUR45.7 million a year ago.

According to Reuters, revenue dipped to EUR51.5 million from
EUR54.8 million.

"This decrease by EUR3.3 million is more than compensated by a
decrease in cost of goods sold, in employee benefits and in other
operating expenses for EUR 6.6 million and the absence of
valuation losses," Reuters quoted the company as saying.

                       Creditor Protection

On May 19, Reuters' Mr. Hovet reported that a Paris court had
approved a plan exiting Orco from its more than year-long creditor
protection period.  Reuters disclosed Orco said the plan includes
the repayment of 100% of the company's admitted claims over 10
years.  The court protection in place since March last year had
protected EUR1.5 billion (US$1.9 billion) in bank debts and bonds,
Reuters noted.  Orco has proposed a 10 year rescheduling plan to
restructure more than EUR400 million in debt held by bondholders
through a scheme that looks to extend the average maturity of its
bonds to eight years from three, Reuters said.

Orco Property Group SA -- http://www.orcogroup.com/-- is a
Luxembourg-based real estate company, specializing in the
development, rental and management of properties in Central and
Eastern Europe.  Through its fully consolidated subsidiaries, Orco
Property Group SA operates in several countries, including the
Czech Republic, Slovakia, Germany, Hungary, Poland, Croatia and
Russia.  The Company rents and manages real estate and hotels
properties composed of office buildings, apartments with services,
luxury hotels and hotel residences; it also develops real estate
projects as promoter.


=============
R O M A N I A
=============


DIVERTA: Owner Files for Insolvency & Eyes Reorganization
---------------------------------------------------------
Octavian Radu, Diverta's owner, has filed for insolvency with a
view to its judicial reorganization, Mirabel Tiron at Ziarul
Financiar reports, citing the company's representatives.

"Diverta's debts top EUR10 million and this is why we chose to go
in judicial reorganization.  The current conditions of the economy
and the inflexibility of developers (i.e. the shopping centers
where Diverta has stores opened) have given rise to the current
cash flow problems," the report quoted Diverta CEO Amalia Buliga
as saying.

According to the report, the court-appointed administrator will be
Casa de Insolventa Transilvania (Transylvania Insolvency Firm).

Based in Romania, Diverta is a distributor of an extensive range
of products, including books, music, movies, toys, video games, IT
and stationery.


===========
R U S S I A
===========


ALFA BANK: Fitch Upgrades Long-Term IDR to 'BB' From 'BB-'
----------------------------------------------------------
Fitch Ratings has upgraded Alfa-Bank's and MDM Bank's Long-term
Issuer Default Ratings to 'BB' from 'BB-' and upgraded Nomos
Bank's Long-term IDR to 'BB-' from 'B+'.  The agency has removed
all three banks' from Rating Watch Positive and assigned a Stable
Outlook to each bank's Long-term IDR.

Fitch has simultaneously affirmed the Long-term IDRs of four other
Russian banks -- Promsvyazbank, Bank Zenit, JSC Russian Standard
Bank and Bank Uralsib -- and the Uralsib Leasing Group at 'B+'.
The agency has removed all five entities from Rating Watch
Evolving and assigned Stable Outlooks with the exception of PSB
which has been assigned a Positive Outlook.

These rating actions resolve the rating watches Fitch had placed
on the banks' ratings on 5 March 2010.

The upgrades of Alfa, MDM and Nomos reflect the strengthening of
certain aspects of Russia's banking system infrastructure during
the global financial crisis, most notably in respect of banks
ability to access liquidity, but also in regard to the
establishment of more orderly procedures for management of bank
failures.  Fitch expects these changes to materially reduce
default risk for all significantly-sized Russian banks going
forward.  The upgrades further reflect each bank's demonstrated
ability to survive the major asset quality stress posed by the
crisis without requiring emergency capital support, and their
currently substantial loss absorption capacity.

The affirmations of PSB, Zenit, RSB and BU also take into account
the improvements in market infrastructure noted above.  However,
these banks' ratings are currently constrained by weaknesses in
their individual credit profiles.

Alfa has achieved considerable success in working out problem
exposures: NPLs (loans overdue by 90 days or more) decreased to
13% at end-2009 from almost 17% at end-Q309, and, according to
management data, fell further to 9% at end-Q110.  Rolled-over
loans were 11.5% at end-2009 and Fitch has been informed that most
are performing.  Alfa's liquidity is comfortable, with cash and
unpledged liquid securities of around US$3 billion, while 2010-
2011 wholesale debt repayments are moderate at US$854 million.
Capitalization has been bolstered by US$320 million of equity from
shareholders and US$1.3 billion of subordinated debt from
Vnesheconombank in 2009, raising Basel I Total and Tier 1 ratios
to, respectively, 20% and 13% at end-2009.  Fitch estimates that
on a consolidated basis Alfa could withstand about 22% of credit
losses before its Basel I total capital adequacy ratio would
decrease to the covenanted level of 8%.

MDM's NPLs stood at 17.4% of the loan book at end-2009, and rose
slightly in Q110 according to management.  Fitch has been informed
that restructured loans accounted for a further 11.7% of the loan
book at end-2009.  However, MDM's strong capitalization meant that
the bank could have absorbed 29% credit losses at end-Q110 before
its regulatory capital would have fallen to the minimum allowed
10%.  In addition, MDM's shareholders have stated their readiness
to inject US$500 million, if needed, to maintain the regulatory
capital adequacy ratio at 12%.  In Fitch's view, MDM's liquidity
is ample, with cash and unpledged liquid securities accounting for
approximately 16% of assets at end-Q110, and managed
conservatively.  MDM has strong corporate governance for a Russian
bank and low related party lending, which are also credit
positive.

Nomos's NPLs were 6.2% of gross loans at end-2009, having
increased only negligibly during H209, while reported restructured
loans were a further 20% of the loan book at end-2009.  Nomos'
loss absorption capacity is sound, with the bank able to withstand
up to 24% of loan losses at end-April 2010 without breaching
minimum regulatory capital requirements.  Shareholders plan to
convert subordinated debt amounting to RUB5 billion into equity
during 2010, which should further strengthen the bank's core
capital.  Nomos' liquidity position is comfortable, with highly
liquid assets equal to 26% of customer funding at end-Q110.

PSB's NPLs stood at 13.1% at end-2009, while rolled-over loans
were sizable.  The regulatory capital ratio at end-April 2010 was
a tight 10.2% (just above the 10% minimum).  In part, this was a
result of the bank reporting losses under local standards in 4M10,
mainly driven by additional provisions and a decrease in the net
interest margin, which were roughly equal in size to the RUB5.4
billion equity injection received in February 2010.  PSB's loan
impairment reserves at end-2009 stood at 12.7% of gross loans and
are projected by management to peak at 15% during 2010.
Consolidated Basel I capital ratios were about 3ppts higher than
the unconsolidated regulatory ratios at end-2009, and stood at
9.9% (tier 1) and 14.3% (total).  Liquidity is comfortable, with
cash and equivalents, unpledged securities and the net short-term
interbank position at end-Q110 amounting to 20% of liabilities or
30% of customer balances.  PSB's Positive Outlook reflects Fitch's
base case expectation that during the next 12 months the bank's
asset quality will stabilize and capitalization will strengthen,
which could result in a potential upgrade of the bank's Long-term
IDR to 'BB-'.  However, if asset quality and capital weaknesses
persist, PSB's Outlook could be revised back to Stable.

BU's NPLs at end-2009 represented 13.8% of the loan book, and
restructured loans were another 17% of the portfolio.  Fitch notes
that credit risks are mitigated by the lower share of FX lending,
borrower concentrations and exposure to the construction segment
compared to peers.  However, BU's IDR is constrained by
substantial related-party exposures and sizable market risk
resulting from real estate and equity investments.  The regulatory
capital ratio at end-April 2010 was 14.7%, with reserves broadly
in line with end-2009 NPL levels; consolidated Basel I ratios are
generally stronger than the regulatory ones (tier 1 13.7% and
total ratio 18% at end-2009).  Liquidity is comfortable at
present, with a loans/deposits ratio of 95% and limited wholesale
borrowings.  If BU significantly reduces its related party
exposures and market risk appetite, while maintaining or
strengthening other aspects of its credit profile, the bank's
Long-term IDR could be upgraded to 'BB-'.

Zenit's reported level of NPLs was somewhat lower than peers, at
7.4% of the gross loan book at end-2009, while reported
restructured loans were 9%.  However, the latter could be
significantly higher, in Fitch's view, given the high level of
rolled over loans among the bank's largest borrowers.  Fitch also
notes the bank's large exposure to the construction and real
estate sectors (25% of loans at end-2009) and significant volumes
of longer-term loans, some with bullet principal repayments.
These potential sources of significant credit risk, combined with
the bank's more limited and concentrated franchise, relative to
larger Russian privately-owned banks, currently constrain the
Long-term IDR at the 'B+' level.  The regulatory capital ratio
stood at a reasonable 15.5% at end-April 2010, with the Basel I
total and tier 1 ratios standing at 18.6% and 12.8%, respectively,
at end-2009.  However, Zenit's loss absorption capacity is limited
by the significant tier 2 component of capital, and it could
potentially increase its statutory reserves to 15.8% of loans from
the actual 7.2% at end-April 2010 without breaching the minimum
regulatory capital requirement of 10%.  The liquidity position is
stable and refinancing risk is low as domestic bonds maturing, or
having a put option, in 2010 accounted for 5% of total assets at
end-2009.

JSC Russian Standard Bank's (RSB) ratings reflect uncertainties
about the sustainability of its business model in view of an
actual (33% in 2009 and 5% in Q110) and potential unwinding of the
loan book, which may have negative implications for profitability,
as well as the bank's franchise.  The participation in a tender
for the formation of a joint venture bank with the Russian Post is
another source of ambiguity, as the results of the tender have yet
to be announced and the deal structure/terms have not been
decided.  At the same time, short-term risks for RSB are limited,
given effective credit risk controls (credit cost of below 5%
targeted, which is consistent with reported NPLs on 2009
vintages), the solid capital position (end-Q110 Basel tier 1 and
total capital ratios of 20.5% and 30.8% respectively) and the
liquid balance sheet (currently available liquidity buffer of
about US$700m and monthly incoming cash flows from retail loan
repayments of about US$200 million), which is sufficient to
service 2010 debt maturities of about US$740 million.

The rating actions represent the first part of a broader Fitch
review of privately-owned Russian banks' ratings which were placed
on rating watch in March 2010.  Fitch expects to complete the
broader review in the next few weeks.

The rating actions are:

OJSC Alfa-Bank

  -- Long-term IDR: upgraded to 'BB' from 'BB-'; removed from
     Rating Watch Positive; assigned Stable Outlook

  -- Senior unsecured debt: upgraded to 'BB' from 'BB-'; removed
     from Rating Watch Positive

  -- Subordinated debt: upgraded to 'BB-' from 'B+'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'C/D' from 'D'; removed from
     Rating Watch Positive

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

  -- National Long-term rating: upgraded to 'AA-(rus)' from
     'A+(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

MDM Bank (OJSC)

  -- Long-term foreign and local currency IDRs: upgraded to 'BB'
     from 'BB-'; removed from Rating Watch Positive; assigned
     Stable Outlooks

  -- Senior unsecured debt: upgraded to 'BB' from 'BB-'; removed
     from Rating Watch Positive

  -- Subordinated debt: upgraded to 'BB-' from 'B+'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'C/D' from 'D'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

  -- National Long-term Rating: upgraded to 'AA-(rus)' from
     'A+(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

NOMOS-BANK

  -- Long-term foreign currency IDR: upgraded to 'BB-' from 'B+';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'BB-'; Outlook
     Stable

  -- Senior unsecured debt: upgraded to 'BB-' from 'B+'; removed
     from Rating Watch Positive; Recovery Rating of 'RR4'
     withdrawn

  -- Subordinated debt: upgraded to 'B+' from 'B-'; removed from
     Rating Watch Positive Recovery Rating of 'RR6' withdrawn

  -- Subordinated debt issue of US$350 million, 8.75% notes, due
     October 2015: assigned a final rating of 'B+'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'B-'

  -- National Long-term Rating: : upgraded to 'A+(rus)' from
     'A(rus)'; removed from Rating Watch Positive; assigned Stable
     Outlook

Promsvyazbank

  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Positive Outlook

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR4'

  -- Subordinated debt: affirmed at 'B-'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR6'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

Bank Uralsib
  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Stable Outlook

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

Uralsib Leasing Group

  -- Long-term foreign and local currency IDRs: affirmed at 'B+';
     removed from Rating Watch Evolving; assigned Stable Outlooks

  -- Short-term IDR: affirmed at 'B'

  -- Support Rating: affirmed at '4'; removed from Rating Watch
     Positive

Bank Zenit

  -- Long-term foreign and local currency IDRs: affirmed at 'B+';
     removed from Rating Watch Evolving; assigned Stable Outlooks

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR4'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term Rating: affirmed at 'A-(rus)'; removed
     from Rating Watch Evolving; assigned Stable Outlook

JSC Russian Standard Bank

  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Stable Outlook

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; assigned Recovery Rating of 'RR4'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'


MDM BANK: Fitch Upgrades Long-Term IDR to 'BB' From 'BB-'
---------------------------------------------------------
Fitch Ratings has upgraded Alfa-Bank's and MDM Bank's Long-term
Issuer Default Ratings to 'BB' from 'BB-' and upgraded Nomos
Bank's Long-term IDR to 'BB-' from 'B+'.  The agency has removed
all three banks' from Rating Watch Positive and assigned a Stable
Outlook to each bank's Long-term IDR.

Fitch has simultaneously affirmed the Long-term IDRs of four other
Russian banks -- Promsvyazbank, Bank Zenit, JSC Russian Standard
Bank and Bank Uralsib -- and the Uralsib Leasing Group at 'B+'.
The agency has removed all five entities from Rating Watch
Evolving and assigned Stable Outlooks with the exception of PSB
which has been assigned a Positive Outlook.

These rating actions resolve the rating watches Fitch had placed
on the banks' ratings on 5 March 2010.

The upgrades of Alfa, MDM and Nomos reflect the strengthening of
certain aspects of Russia's banking system infrastructure during
the global financial crisis, most notably in respect of banks
ability to access liquidity, but also in regard to the
establishment of more orderly procedures for management of bank
failures.  Fitch expects these changes to materially reduce
default risk for all significantly-sized Russian banks going
forward.  The upgrades further reflect each bank's demonstrated
ability to survive the major asset quality stress posed by the
crisis without requiring emergency capital support, and their
currently substantial loss absorption capacity.

The affirmations of PSB, Zenit, RSB and BU also take into account
the improvements in market infrastructure noted above.  However,
these banks' ratings are currently constrained by weaknesses in
their individual credit profiles.

Alfa has achieved considerable success in working out problem
exposures: NPLs (loans overdue by 90 days or more) decreased to
13% at end-2009 from almost 17% at end-Q309, and, according to
management data, fell further to 9% at end-Q110.  Rolled-over
loans were 11.5% at end-2009 and Fitch has been informed that most
are performing.  Alfa's liquidity is comfortable, with cash and
unpledged liquid securities of around US$3 billion, while 2010-
2011 wholesale debt repayments are moderate at US$854 million.
Capitalization has been bolstered by US$320 million of equity from
shareholders and US$1.3 billion of subordinated debt from
Vnesheconombank in 2009, raising Basel I Total and Tier 1 ratios
to, respectively, 20% and 13% at end-2009.  Fitch estimates that
on a consolidated basis Alfa could withstand about 22% of credit
losses before its Basel I total capital adequacy ratio would
decrease to the covenanted level of 8%.

MDM's NPLs stood at 17.4% of the loan book at end-2009, and rose
slightly in Q110 according to management.  Fitch has been informed
that restructured loans accounted for a further 11.7% of the loan
book at end-2009.  However, MDM's strong capitalization meant that
the bank could have absorbed 29% credit losses at end-Q110 before
its regulatory capital would have fallen to the minimum allowed
10%.  In addition, MDM's shareholders have stated their readiness
to inject US$500 million, if needed, to maintain the regulatory
capital adequacy ratio at 12%.  In Fitch's view, MDM's liquidity
is ample, with cash and unpledged liquid securities accounting for
approximately 16% of assets at end-Q110, and managed
conservatively.  MDM has strong corporate governance for a Russian
bank and low related party lending, which are also credit
positive.

Nomos's NPLs were 6.2% of gross loans at end-2009, having
increased only negligibly during H209, while reported restructured
loans were a further 20% of the loan book at end-2009.  Nomos'
loss absorption capacity is sound, with the bank able to withstand
up to 24% of loan losses at end-April 2010 without breaching
minimum regulatory capital requirements.  Shareholders plan to
convert subordinated debt amounting to RUB5 billion into equity
during 2010, which should further strengthen the bank's core
capital.  Nomos' liquidity position is comfortable, with highly
liquid assets equal to 26% of customer funding at end-Q110.

PSB's NPLs stood at 13.1% at end-2009, while rolled-over loans
were sizable.  The regulatory capital ratio at end-April 2010 was
a tight 10.2% (just above the 10% minimum).  In part, this was a
result of the bank reporting losses under local standards in 4M10,
mainly driven by additional provisions and a decrease in the net
interest margin, which were roughly equal in size to the RUB5.4
billion equity injection received in February 2010.  PSB's loan
impairment reserves at end-2009 stood at 12.7% of gross loans and
are projected by management to peak at 15% during 2010.
Consolidated Basel I capital ratios were about 3ppts higher than
the unconsolidated regulatory ratios at end-2009, and stood at
9.9% (tier 1) and 14.3% (total).  Liquidity is comfortable, with
cash and equivalents, unpledged securities and the net short-term
interbank position at end-Q110 amounting to 20% of liabilities or
30% of customer balances.  PSB's Positive Outlook reflects Fitch's
base case expectation that during the next 12 months the bank's
asset quality will stabilize and capitalization will strengthen,
which could result in a potential upgrade of the bank's Long-term
IDR to 'BB-'.  However, if asset quality and capital weaknesses
persist, PSB's Outlook could be revised back to Stable.

BU's NPLs at end-2009 represented 13.8% of the loan book, and
restructured loans were another 17% of the portfolio.  Fitch notes
that credit risks are mitigated by the lower share of FX lending,
borrower concentrations and exposure to the construction segment
compared to peers.  However, BU's IDR is constrained by
substantial related-party exposures and sizable market risk
resulting from real estate and equity investments.  The regulatory
capital ratio at end-April 2010 was 14.7%, with reserves broadly
in line with end-2009 NPL levels; consolidated Basel I ratios are
generally stronger than the regulatory ones (tier 1 13.7% and
total ratio 18% at end-2009).  Liquidity is comfortable at
present, with a loans/deposits ratio of 95% and limited wholesale
borrowings.  If BU significantly reduces its related party
exposures and market risk appetite, while maintaining or
strengthening other aspects of its credit profile, the bank's
Long-term IDR could be upgraded to 'BB-'.

Zenit's reported level of NPLs was somewhat lower than peers, at
7.4% of the gross loan book at end-2009, while reported
restructured loans were 9%.  However, the latter could be
significantly higher, in Fitch's view, given the high level of
rolled over loans among the bank's largest borrowers.  Fitch also
notes the bank's large exposure to the construction and real
estate sectors (25% of loans at end-2009) and significant volumes
of longer-term loans, some with bullet principal repayments.
These potential sources of significant credit risk, combined with
the bank's more limited and concentrated franchise, relative to
larger Russian privately-owned banks, currently constrain the
Long-term IDR at the 'B+' level.  The regulatory capital ratio
stood at a reasonable 15.5% at end-April 2010, with the Basel I
total and tier 1 ratios standing at 18.6% and 12.8%, respectively,
at end-2009.  However, Zenit's loss absorption capacity is limited
by the significant tier 2 component of capital, and it could
potentially increase its statutory reserves to 15.8% of loans from
the actual 7.2% at end-April 2010 without breaching the minimum
regulatory capital requirement of 10%.  The liquidity position is
stable and refinancing risk is low as domestic bonds maturing, or
having a put option, in 2010 accounted for 5% of total assets at
end-2009.

JSC Russian Standard Bank's (RSB) ratings reflect uncertainties
about the sustainability of its business model in view of an
actual (33% in 2009 and 5% in Q110) and potential unwinding of the
loan book, which may have negative implications for profitability,
as well as the bank's franchise.  The participation in a tender
for the formation of a joint venture bank with the Russian Post is
another source of ambiguity, as the results of the tender have yet
to be announced and the deal structure/terms have not been
decided.  At the same time, short-term risks for RSB are limited,
given effective credit risk controls (credit cost of below 5%
targeted, which is consistent with reported NPLs on 2009
vintages), the solid capital position (end-Q110 Basel tier 1 and
total capital ratios of 20.5% and 30.8% respectively) and the
liquid balance sheet (currently available liquidity buffer of
about US$700m and monthly incoming cash flows from retail loan
repayments of about US$200 million), which is sufficient to
service 2010 debt maturities of about US$740 million.

The rating actions represent the first part of a broader Fitch
review of privately-owned Russian banks' ratings which were placed
on rating watch in March 2010.  Fitch expects to complete the
broader review in the next few weeks.

The rating actions are:

OJSC Alfa-Bank

  -- Long-term IDR: upgraded to 'BB' from 'BB-'; removed from
     Rating Watch Positive; assigned Stable Outlook

  -- Senior unsecured debt: upgraded to 'BB' from 'BB-'; removed
     from Rating Watch Positive

  -- Subordinated debt: upgraded to 'BB-' from 'B+'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'C/D' from 'D'; removed from
     Rating Watch Positive

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

  -- National Long-term rating: upgraded to 'AA-(rus)' from
     'A+(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

MDM Bank (OJSC)

  -- Long-term foreign and local currency IDRs: upgraded to 'BB'
     from 'BB-'; removed from Rating Watch Positive; assigned
     Stable Outlooks

  -- Senior unsecured debt: upgraded to 'BB' from 'BB-'; removed
     from Rating Watch Positive

  -- Subordinated debt: upgraded to 'BB-' from 'B+'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'C/D' from 'D'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

  -- National Long-term Rating: upgraded to 'AA-(rus)' from
     'A+(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

NOMOS-BANK

  -- Long-term foreign currency IDR: upgraded to 'BB-' from 'B+';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'BB-'; Outlook
     Stable

  -- Senior unsecured debt: upgraded to 'BB-' from 'B+'; removed
     from Rating Watch Positive; Recovery Rating of 'RR4'
     withdrawn

  -- Subordinated debt: upgraded to 'B+' from 'B-'; removed from
     Rating Watch Positive Recovery Rating of 'RR6' withdrawn

  -- Subordinated debt issue of US$350 million, 8.75% notes, due
     October 2015: assigned a final rating of 'B+'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'B-'

  -- National Long-term Rating: : upgraded to 'A+(rus)' from
     'A(rus)'; removed from Rating Watch Positive; assigned Stable
     Outlook

Promsvyazbank

  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Positive Outlook

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR4'

  -- Subordinated debt: affirmed at 'B-'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR6'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

Bank Uralsib
  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Stable Outlook

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

Uralsib Leasing Group

  -- Long-term foreign and local currency IDRs: affirmed at 'B+';
     removed from Rating Watch Evolving; assigned Stable Outlooks

  -- Short-term IDR: affirmed at 'B'

  -- Support Rating: affirmed at '4'; removed from Rating Watch
     Positive

Bank Zenit

  -- Long-term foreign and local currency IDRs: affirmed at 'B+';
     removed from Rating Watch Evolving; assigned Stable Outlooks

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR4'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term Rating: affirmed at 'A-(rus)'; removed
     from Rating Watch Evolving; assigned Stable Outlook

JSC Russian Standard Bank

  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Stable Outlook

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; assigned Recovery Rating of 'RR4'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'


NOMOS BANK: Fitch Upgrades Long-Term IDR to 'BB-' From 'B+'
-----------------------------------------------------------
Fitch Ratings has upgraded Alfa-Bank's and MDM Bank's Long-term
Issuer Default Ratings to 'BB' from 'BB-' and upgraded Nomos
Bank's Long-term IDR to 'BB-' from 'B+'.  The agency has removed
all three banks' from Rating Watch Positive and assigned a Stable
Outlook to each bank's Long-term IDR.

Fitch has simultaneously affirmed the Long-term IDRs of four other
Russian banks -- Promsvyazbank, Bank Zenit, JSC Russian Standard
Bank and Bank Uralsib -- and the Uralsib Leasing Group at 'B+'.
The agency has removed all five entities from Rating Watch
Evolving and assigned Stable Outlooks with the exception of PSB
which has been assigned a Positive Outlook.

These rating actions resolve the rating watches Fitch had placed
on the banks' ratings on 5 March 2010.

The upgrades of Alfa, MDM and Nomos reflect the strengthening of
certain aspects of Russia's banking system infrastructure during
the global financial crisis, most notably in respect of banks
ability to access liquidity, but also in regard to the
establishment of more orderly procedures for management of bank
failures.  Fitch expects these changes to materially reduce
default risk for all significantly-sized Russian banks going
forward.  The upgrades further reflect each bank's demonstrated
ability to survive the major asset quality stress posed by the
crisis without requiring emergency capital support, and their
currently substantial loss absorption capacity.

The affirmations of PSB, Zenit, RSB and BU also take into account
the improvements in market infrastructure noted above.  However,
these banks' ratings are currently constrained by weaknesses in
their individual credit profiles.

Alfa has achieved considerable success in working out problem
exposures: NPLs (loans overdue by 90 days or more) decreased to
13% at end-2009 from almost 17% at end-Q309, and, according to
management data, fell further to 9% at end-Q110.  Rolled-over
loans were 11.5% at end-2009 and Fitch has been informed that most
are performing.  Alfa's liquidity is comfortable, with cash and
unpledged liquid securities of around US$3 billion, while 2010-
2011 wholesale debt repayments are moderate at US$854 million.
Capitalization has been bolstered by US$320 million of equity from
shareholders and US$1.3 billion of subordinated debt from
Vnesheconombank in 2009, raising Basel I Total and Tier 1 ratios
to, respectively, 20% and 13% at end-2009.  Fitch estimates that
on a consolidated basis Alfa could withstand about 22% of credit
losses before its Basel I total capital adequacy ratio would
decrease to the covenanted level of 8%.

MDM's NPLs stood at 17.4% of the loan book at end-2009, and rose
slightly in Q110 according to management.  Fitch has been informed
that restructured loans accounted for a further 11.7% of the loan
book at end-2009.  However, MDM's strong capitalization meant that
the bank could have absorbed 29% credit losses at end-Q110 before
its regulatory capital would have fallen to the minimum allowed
10%.  In addition, MDM's shareholders have stated their readiness
to inject US$500 million, if needed, to maintain the regulatory
capital adequacy ratio at 12%.  In Fitch's view, MDM's liquidity
is ample, with cash and unpledged liquid securities accounting for
approximately 16% of assets at end-Q110, and managed
conservatively.  MDM has strong corporate governance for a Russian
bank and low related party lending, which are also credit
positive.

Nomos's NPLs were 6.2% of gross loans at end-2009, having
increased only negligibly during H209, while reported restructured
loans were a further 20% of the loan book at end-2009.  Nomos'
loss absorption capacity is sound, with the bank able to withstand
up to 24% of loan losses at end-April 2010 without breaching
minimum regulatory capital requirements.  Shareholders plan to
convert subordinated debt amounting to RUB5 billion into equity
during 2010, which should further strengthen the bank's core
capital.  Nomos' liquidity position is comfortable, with highly
liquid assets equal to 26% of customer funding at end-Q110.

PSB's NPLs stood at 13.1% at end-2009, while rolled-over loans
were sizable.  The regulatory capital ratio at end-April 2010 was
a tight 10.2% (just above the 10% minimum).  In part, this was a
result of the bank reporting losses under local standards in 4M10,
mainly driven by additional provisions and a decrease in the net
interest margin, which were roughly equal in size to the RUB5.4
billion equity injection received in February 2010.  PSB's loan
impairment reserves at end-2009 stood at 12.7% of gross loans and
are projected by management to peak at 15% during 2010.
Consolidated Basel I capital ratios were about 3ppts higher than
the unconsolidated regulatory ratios at end-2009, and stood at
9.9% (tier 1) and 14.3% (total).  Liquidity is comfortable, with
cash and equivalents, unpledged securities and the net short-term
interbank position at end-Q110 amounting to 20% of liabilities or
30% of customer balances.  PSB's Positive Outlook reflects Fitch's
base case expectation that during the next 12 months the bank's
asset quality will stabilize and capitalization will strengthen,
which could result in a potential upgrade of the bank's Long-term
IDR to 'BB-'.  However, if asset quality and capital weaknesses
persist, PSB's Outlook could be revised back to Stable.

BU's NPLs at end-2009 represented 13.8% of the loan book, and
restructured loans were another 17% of the portfolio.  Fitch notes
that credit risks are mitigated by the lower share of FX lending,
borrower concentrations and exposure to the construction segment
compared to peers.  However, BU's IDR is constrained by
substantial related-party exposures and sizable market risk
resulting from real estate and equity investments.  The regulatory
capital ratio at end-April 2010 was 14.7%, with reserves broadly
in line with end-2009 NPL levels; consolidated Basel I ratios are
generally stronger than the regulatory ones (tier 1 13.7% and
total ratio 18% at end-2009).  Liquidity is comfortable at
present, with a loans/deposits ratio of 95% and limited wholesale
borrowings.  If BU significantly reduces its related party
exposures and market risk appetite, while maintaining or
strengthening other aspects of its credit profile, the bank's
Long-term IDR could be upgraded to 'BB-'.

Zenit's reported level of NPLs was somewhat lower than peers, at
7.4% of the gross loan book at end-2009, while reported
restructured loans were 9%.  However, the latter could be
significantly higher, in Fitch's view, given the high level of
rolled over loans among the bank's largest borrowers.  Fitch also
notes the bank's large exposure to the construction and real
estate sectors (25% of loans at end-2009) and significant volumes
of longer-term loans, some with bullet principal repayments.
These potential sources of significant credit risk, combined with
the bank's more limited and concentrated franchise, relative to
larger Russian privately-owned banks, currently constrain the
Long-term IDR at the 'B+' level.  The regulatory capital ratio
stood at a reasonable 15.5% at end-April 2010, with the Basel I
total and tier 1 ratios standing at 18.6% and 12.8%, respectively,
at end-2009.  However, Zenit's loss absorption capacity is limited
by the significant tier 2 component of capital, and it could
potentially increase its statutory reserves to 15.8% of loans from
the actual 7.2% at end-April 2010 without breaching the minimum
regulatory capital requirement of 10%.  The liquidity position is
stable and refinancing risk is low as domestic bonds maturing, or
having a put option, in 2010 accounted for 5% of total assets at
end-2009.

JSC Russian Standard Bank's (RSB) ratings reflect uncertainties
about the sustainability of its business model in view of an
actual (33% in 2009 and 5% in Q110) and potential unwinding of the
loan book, which may have negative implications for profitability,
as well as the bank's franchise.  The participation in a tender
for the formation of a joint venture bank with the Russian Post is
another source of ambiguity, as the results of the tender have yet
to be announced and the deal structure/terms have not been
decided.  At the same time, short-term risks for RSB are limited,
given effective credit risk controls (credit cost of below 5%
targeted, which is consistent with reported NPLs on 2009
vintages), the solid capital position (end-Q110 Basel tier 1 and
total capital ratios of 20.5% and 30.8% respectively) and the
liquid balance sheet (currently available liquidity buffer of
about US$700m and monthly incoming cash flows from retail loan
repayments of about US$200 million), which is sufficient to
service 2010 debt maturities of about US$740 million.

The rating actions represent the first part of a broader Fitch
review of privately-owned Russian banks' ratings which were placed
on rating watch in March 2010.  Fitch expects to complete the
broader review in the next few weeks.

The rating actions are:

OJSC Alfa-Bank

  -- Long-term IDR: upgraded to 'BB' from 'BB-'; removed from
     Rating Watch Positive; assigned Stable Outlook

  -- Senior unsecured debt: upgraded to 'BB' from 'BB-'; removed
     from Rating Watch Positive

  -- Subordinated debt: upgraded to 'BB-' from 'B+'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'C/D' from 'D'; removed from
     Rating Watch Positive

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

  -- National Long-term rating: upgraded to 'AA-(rus)' from
     'A+(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

MDM Bank (OJSC)

  -- Long-term foreign and local currency IDRs: upgraded to 'BB'
     from 'BB-'; removed from Rating Watch Positive; assigned
     Stable Outlooks

  -- Senior unsecured debt: upgraded to 'BB' from 'BB-'; removed
     from Rating Watch Positive

  -- Subordinated debt: upgraded to 'BB-' from 'B+'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: upgraded to 'C/D' from 'D'; removed from
     Rating Watch Positive

  -- Short-term IDR: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

  -- National Long-term Rating: upgraded to 'AA-(rus)' from
     'A+(rus)'; removed from Rating Watch Positive; assigned
     Stable Outlook

NOMOS-BANK

  -- Long-term foreign currency IDR: upgraded to 'BB-' from 'B+';
     removed from Rating Watch Positive; assigned Stable Outlook

  -- Long-term local currency IDR: assigned at 'BB-'; Outlook
     Stable

  -- Senior unsecured debt: upgraded to 'BB-' from 'B+'; removed
     from Rating Watch Positive; Recovery Rating of 'RR4'
     withdrawn

  -- Subordinated debt: upgraded to 'B+' from 'B-'; removed from
     Rating Watch Positive Recovery Rating of 'RR6' withdrawn

  -- Subordinated debt issue of US$350 million, 8.75% notes, due
     October 2015: assigned a final rating of 'B+'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'B-'

  -- National Long-term Rating: : upgraded to 'A+(rus)' from
     'A(rus)'; removed from Rating Watch Positive; assigned Stable
     Outlook

Promsvyazbank

  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Positive Outlook

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR4'

  -- Subordinated debt: affirmed at 'B-'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR6'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

Bank Uralsib
  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Stable Outlook

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '4'

  -- Support Rating Floor: affirmed at 'B'

Uralsib Leasing Group

  -- Long-term foreign and local currency IDRs: affirmed at 'B+';
     removed from Rating Watch Evolving; assigned Stable Outlooks

  -- Short-term IDR: affirmed at 'B'

  -- Support Rating: affirmed at '4'; removed from Rating Watch
     Positive

Bank Zenit

  -- Long-term foreign and local currency IDRs: affirmed at 'B+';
     removed from Rating Watch Evolving; assigned Stable Outlooks

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; Recovery Rating at 'RR4'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'

  -- National Long-term Rating: affirmed at 'A-(rus)'; removed
     from Rating Watch Evolving; assigned Stable Outlook

JSC Russian Standard Bank

  -- Long-term IDR: affirmed at 'B+'; removed from Rating Watch
     Evolving; assigned Stable Outlook

  -- Senior unsecured debt: affirmed at 'B+'; removed from Rating
     Watch Evolving; assigned Recovery Rating of 'RR4'

  -- Short-term IDR: affirmed at 'B'

  -- Individual Rating: affirmed at 'D'

  -- Support Rating: affirmed at '5'

  -- Support Rating Floor: affirmed at 'No Floor'


===============
S L O V E N I A
===============


ISTRABENZ GROUP: Back to Profit in Q1 on Higher Asset Value
-----------------------------------------------------------
Boris Cerni at Bloomberg News reports that Istrabenz Group d.d.
returned to profit in the first quarter on higher asset value.

According to Bloomberg, Istrabenz said in a statement to the
Ljubljana stock exchange that the company's net income was EUR1.7
million (US$2.1 million), compared with a EUR35.8-million loss in
the same period a year ago.  The company, as cited by Bloomberg
said, revenue was down 1% to EUR152.4 million.

"The main reason for a brighter picture is the re-evaluation of
our assets," Bloomberg quoted Istrabenz spokeswoman Marinella
Veskovo as saying.  "In November, we started to assign a fair
value to our assets instead of a book value."

As reported by the Troubled Company Reporter-Europe, Istrabenz
declared insolvency in 2009 and went into receivership this year
after it struggled to repay debt accumulated before the global
financial crisis.  The company is selling assets to repay loans to
19 banks, including the two of Slovenia's largest lenders Nova
Ljubljanska Banka d.d. and Nova Kreditna Banka Maribor d.d.

Istrabenz dd -- http://www.istrabenz.si/-- is a Slovenia-based
holding responsible for the asset management and supervision of
the Istrabenz Group members.  The Company has developed
investments in the number of divisions: Energy, which covers the
gas business, production and distribution of energy, transshipment
and storage of oil derivatives; Tourism, which offers hotel,
catering, wellness and congress services; Investments, which deals
with advertising, financial services and technical consulting;
Food, which markets food products, and Information Technology that
provides information support to the companies of the Istrabenz
Group.  As of December 31, 2008 Istrabenz Group comprised 77
companies.  The Company operates a number of subsidiaries,
including wholly owned Istrabenz Turizem dd and Istrabenz Marina
Invest doo.


=========
S P A I N
=========


PRIVATE MEDIA: Recurring Losses Prompt Going Concern Doubt
----------------------------------------------------------
Private Media Group filed its annual report on Form 10-K,
reporting a net loss of EUR20.5 million on EUR23.1 million of
revenue for the year ended December 31, 2009, compared with a net
loss of EUR5.2 million on EUR19.7 million of revenue for the year
ended December 31, 2008.

The Company's balance sheet as of December 31, 2009, showed
EUR48.5 million in assets, EUR19.2 million of liabilities, and
EUR29.3 million of stockholders' equity.

BDO Auditores S.L., in Barcelona, Spain, expressed substantial
doubt about the Company's ability to continue as a going concern
after auditing the Company's financial statements for the year
ended December 31, 2009.  The independent auditors noted that the
Company has suffered recurring losses from operations over the
past years and has not yet reestablished profitable operations.

A full-text copy of the annual report is available for free at:

               http://researcharchives.com/t/s?6378

Private Media Group, Inc. is incorporated in the State of Nevada.
The Company provides adult media content for a wide range of media
platforms.  In accordance with Nevada law the Company maintains a
registered office at 3230 Flamingo Road, Suite 156, Las Vegas,
Nevada.  The Company's European headquarters are located at the
offices of one of its principal operating subsidiaries, Milcap
Media Group, S.L.U, whose address is Calle de la Marina 16-18,
Floor 18, Suite D, 08005 Barcelona, Spain.  The Company's U.S.
headquarters are located at 537 Stevenson Street, San Francisco,
California 94103.


* SPAIN: To Tighten Banks' Bad Loan Provisioning Rules
------------------------------------------------------
Victor Mallet at The Financial Times reports that the Bank of
Spain plans to tighten its rules for banks' provisioning against
bad loans.

The FT says the central bank is determined to force through a
rationalization of the 45 cajas de ahorros, the savings banks, by
June 30, to cut their costs and clean up their balance sheets with
the help of a bank restructuring fund.

According to the FT, the Bank of Spain said in a statement on
Wednesday that all banks operating in Spain would have to
provision for 100% of a bad loan within a year of it being listed
as doubtful, compared with the current period of between two and
six years.  At the same time banks will now be able to offset loan
collateral -- usually property or land -- against the provisions,
but only after sharp writedowns on the value of the guarantee,
ranging from 20% for the main residence of the borrower to 50% for
undeveloped land, the FT notes.  The third proposed change will
oblige banks to increase their writedowns on assets acquired in
payment of debts, a favored tactic during the crisis, the FT
discloses.

As reported by the Troubled Company Reporter-Europe on May 27,
2010, The Financial Times said many of the 45 Spanish savings
banks are struggling with high levels of bad loans after the
collapse of the domestic housing market and nearly two years of
economic recession prompted by the global crisis.


=============
U K R A I N E
=============


LEHMAN BROTHERS: Ukraine Stocks Plunge Most Since Lehman Collapse
-----------------------------------------------------------------
Ukrainian stocks plunged the most since the collapse of Lehman
Brothers Holdings Inc., leading a rout of equity markets for a
second day, as investors deserted the riskiest markets on concern
Europe's debt crisis may be getting worse, Jason Corcoran and
Kateryna Choursina of Bloomberg News reported on May 20.

According to the report, Ukraine obtained a US$16.4 billion stand-
by loan from the International Monetary Fund at the end of 2008
to stay afloat as the global credit crisis curbed demand for
exports while shutting off capital flows.

Ukraine's benchmark gauge extended losses after a U.S. government
report showed initial jobless claims rose by 25,000 to 471,000 in
the week ended May 15, exceeding the median forecast of
economists surveyed by Bloomberg, the report said.

The extra yield investors demand to own Ukraine debt over
U.S. Treasuries jumped 75 basis points to 6.84 percentage points,
the highest since February, Bloomberg said citing JPMorgan Chase
& Co. indexes.  The spread reached as much as 35.93 percentage
points in March last year as the IMF delayed the second
installment of the bailout because Ukraine failed to agree to
meet budget targets attached to the load.


                       About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the
fourth largest investment bank in the United States.  For more
than 150 years, Lehman Brothers has been a leader in the global
financial markets by serving the financial needs of corporations,
governmental units, institutional clients and individuals
worldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008
(Bankr. S.D.N.Y. Case No. 08-13555).  Lehman's bankruptcy petition
listed US$639 billion in assets and US$613 billion in debts,
effectively making the firm's bankruptcy filing the largest in
U.S. history.  Several other affiliates followed thereafter.

The Debtors' bankruptcy cases are handled by Judge James M. Peck.
Harvey R. Miller, Esq., Richard P. Krasnow, Esq., Lori R. Fife,
Esq., Shai Y. Waisman, Esq., and Jacqueline Marcus, Esq., at Weil,
Gotshal & Manges, LLP, in New York, represent Lehman.  Epiq
Bankruptcy Solutions serves as claims and noticing agent.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of the
U.S. District Court for the Southern District of New York, entered
an order commencing liquidation of Lehman Brothers, Inc., pursuant
to the provisions of the Securities Investor Protection Act (Case
No. 08-CIV-8119 (GEL)).  James W. Giddens has been appointed as
trustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase of
Lehman Brothers' North American investment banking and capital
markets operations and supporting infrastructure for US$1.75
billion.  Nomura Holdings Inc., the largest brokerage
house in Japan, purchased LBHI's operations in Europe for US$2
plus the retention of most of employees.  Nomura also bought
Lehman's operations in the Asia Pacific for US$225 million.

               International Operations Collapse

Lehman Brothers International (Europe), the principal UK trading
company in the Lehman group, was placed into administration,
together with Lehman Brothers Ltd, LB Holdings PLC and LB UK RE
Holdings Ltd.  Tony Lomas, Steven Pearson, Dan Schwarzmann and
Mike Jervis, partners at PricewaterhouseCoopers LLP, have been
appointed as joint administrators to Lehman Brothers International
(Europe) on September 15, 2008.  The joint administrators have
been appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.
filed for bankruptcy in the Tokyo District Court on September 16.
Lehman Brothers Japan Inc. reported about JPY3.4 trillion
(US$33 billion) in liabilities in its petition.

Bankruptcy Creditors' Service, Inc., publishes Lehman Brothers
Bankruptcy News.  The newsletter tracks the Chapter 11 proceeding
undertaken by Lehman Brothers Holdings, Inc., and other insolvency
and bankruptcy proceedings undertaken by its affiliates.
(http://bankrupt.com/newsstand/or 215/945-7000)


===========================
U N I T E D   K I N G D O M
===========================


BARCUD DERWEN: May Face Administration If Buyer Not Found
---------------------------------------------------------
Alex Hickey at Caernarfon Denbigh Herald.co.uk reports Barcud
Derwen has been put up for sale after running into cash-flow
problems.

According to the report, unless the company is sold imminently, it
could be put into administration, putting 35 jobs at risk.

The report says the Grant Thornton is trying to sell the firm
either as a whole or on a piecemeal basis.

The report relates a copy of a business information document
obtained by the Western Mail showed that Grant Thornton was
"engaged" by Barcud Derwen on May 13, after directors concluded
that the group was "unable to trade through its current cash-flow
difficulties and should enter administration".  It added that
directors have secured the support of the group's funders to
enable it to continue to trade for a "very short period" in an
attempt to sell the group's assets as a going concern but, that a
sale must be completed within 10 days, the report discloses.  That
time period elapsed last week and there has been no news of a
buyer, the report notes.

Both Barcud Derwen and Grant Thornton refused to comment on
whether the business would be placed in administration or, if a
buyer had been found, the report states.

Barcud Derwen is a TV facilities company based in Caernarfon,
Wales.  It has 11 trading divisions or subsidiaries based in the
United Kingdom.


EMI GROUP: Terra Firma Mulls Stake Sale in Music Publishing Unit
----------------------------------------------------------------
Martin Arnold and Andrew Edgecliffe-Johnson at The Financial Times
report that Terra Firma, the private equity owner of EMI, may sell
a minority stake in its music publishing division.

According to the FT, a person familiar with the group said
Terra Firma is considering several approaches to acquire 49% of
the music publishing business.  The FT notes the person said one
approach was from a music publishing joint venture between private
equity group KKR and Germany's BMG.

As reported by the Troubled Company Reporter-Europe on May 17,
2010, Bloomberg News said EMI's investors agreed to inject enough
cash to maintain banking agreements.  Bloomberg disclosed
Citigroup Inc., the principal lender, has been informed the
investment will take place by June 14.  The cash will allow EMI to
meet its debt agreements until March, Bloomberg said, citing an
April 27 presentation to investors.  According to Bloomberg, the
document showed Terra Firma's Guy Hands is also trying to raise
GBP255 million to help EMI meet its covenants until March 2015.

EMI Group Ltd. -- http://www.emigroup.com/-- is the fourth
largest record company in terms of market share (behind Universal
Music Group, Sony Music Entertainment, and Warner Music Group).
It houses recorded music segment EMI Music and EMI Music
Publishing.  EMI Music distributes CDs, videos, and other formats
primarily through imprints and divisions such as Capitol Records
and Virgin, and sports a roster of artists such as The Beastie
Boys, Norah Jones, and Lenny Kravitz.  EMI Music Publishing, the
world's largest music publisher, handles the rights to more than a
million songs.  EMI Music operates through regional divisions (EMI
Music North America, International, and UK & Ireland).  Private
equity firm Terra Firma owns EMI.


GARNER: John Moulton & Pierce Casey Snap Up Business
----------------------------------------------------
Martin Waller at The Times reports that venture capitalist Jon
Moulton has teamed up with Pierce Casey for a financial
restructuring of Garner, the company that owns Norman Broadbent.

According to the report, Mr. Moulton and Mr. Casey are each
injecting GBP1 million into Garner and will eventually emerge with
58% of the company, which will change its name to Norman Broadbent
and attempt to expand the brand by franchise in the U.S., the Far
East and Latin America.

"We're buying a company which is definitely down on its luck.
It's operating at a profit.  It's clearly capable of doing much
better.  I always invest in things I think are going to do much
better," the report quoted Mr. Moulton as saying.

Andrew Garner, the chairman, will become chief executive, while
Mr. Casey takes over his current role, the FT says.

The FT notes Mr. Garner said trading been "dreadful" since Garner
acquired Broadbent in 2008, and the company expects to lose GBP3.5
million in 2009.

Garner is an AIM-listed recruitment firm.


HIGHLAND AIRWAYS: Owes Creditors GBP3.2 Million
-----------------------------------------------
Highland Airways' debts run to more than GBP3.2 million, BBC News
reports, citing documents prepared by the company's
administrators.

According to BBC, the company's creditors are owed GBP1.13
million, which includes a claim for more than GBP50,000 from
Argyll and Bute Council.  Other debts include a GBP1.2 million
bank overdraft, the report notes.

As reported by the Troubled Company Reporter-Europe on March 29,
2010, The Financial Times said that Highland Airways was placed in
administration, putting at risk up to 100 jobs.  The FT disclosed
the company ceased operations on March 24 after its directors
requested the appointment of administrators.  Highland, which was
established in 1991 as Air Alba, had experienced a period of
difficult trading that was further exacerbated by the recent bad
weather, which grounded the fleet for a significant period, and
the loss of three contracted routes in the last six months of
trading, according to the FT.  The FT noted Bruce Cartwright of
PwC, joint administrator, said the directors had been in
discussion with a number of parties, but had concluded that
maintaining operations while introducing a new investor was no
longer feasible.

Highland Airways -- http://www.highlandairways.co.uk/-- was an
airline based in Inverness, Scotland.  The airline operated
passenger and freight charters as well as scheduled services from
its main base at Inverness Airport.  Other services included
newspaper distribution to the northern and Western Isles and,
until recently, charter services for corporate clients.


ITV PLC: S&P Changes Outlook to Stable; Affirms Low-B Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services said that it revised its
outlook on U.K. broadcaster ITV PLC to stable from negative.  At
the same time, S&P affirmed the 'B+' long-term and 'B' short-term
corporate credit ratings on ITV.

The recovery rating of '4' on all of ITV's outstanding bonds is
unchanged.  The recovery rating indicates S&P's expectation of
average (30%-50%) recovery for unsecured creditors in the event of
a payment default.

"The outlook revision reflects S&P's view that ITV's credit
measures will likely improve in 2010," said Standard & Poor's
credit analyst Patrizia D'Amico.  "This is based on the recent
recovery in ITV's advertising revenues reported in the first
quarter of 2010 and the group's anticipation of further material
growth over the next quarter."

Given the group's high operating leverage, S&P anticipate that
top-line growth can rapidly translate into an improvement in
profitability.  This could enable the group's debt to EBITDA ratio
(adjusted for operating leases and pensions and excluding any
netting of excess cash) to drop below 6.0x by year-end 2010.  The
stable outlook also incorporates S&P's view that the group's
pension deficit will remain stable in 2010 and that there will be
no significant changes to current funding assumptions.

In S&P's opinion, the recovery in the U.K. advertising market in
the fourth quarter of 2009 and the first quarter of 2010 is likely
to continue over the next few quarters.  ITV reported 8% growth in
advertising revenues in the first quarter of 2010 and the group
forecasts 22% growth for the second quarter.  Given the
predominance of fixed costs in the group's cost structure, S&P
believes that ITV's EBITDA and cash flow will directly benefit
from top-line growth.  As a result, S&P anticipate that credit
metrics will improve over the course of 2010, such that adjusted
debt to EBITDA will decline below 6.0x at year-end.

S&P could lower the ratings if ITV were unable to reduce adjusted
debt to EBITDA to about 6.0x, from the 7.1x at year-end 2009, and
if the group were unable to maintain positive free cash flow
generation.  S&P could revise the outlook to positive or raise the
rating in the event of a material improvement of the group's
operating performance and credit measures arising from
substantially better-than-expected advertising and economic
conditions in the U.K.


ONCO PETROLEUM: Receiver Eyeing Ex-Owner's Michigan Assets
----------------------------------------------------------
Chip Martin at The London Free Press reports that Stephen Funtig
and Associates, the receiver for Onco Petroleum, is going to court
in Windsor to force the company's former president Robert Vanier
to relinquish Michigan assets to which he is clinging.

The report relates the receiver asserts in court documents that
Mr. Vanier, sole shareholder of Imlay City, Michigan-based Onco
USA, sold that firm's Michigan oil and natural gas assets to Onco
Petroleum in 2006 for US$2.34 million, but Onco USA has retained
title to them.

According to the report, the receiver, which has placed a value of
about US$1 million on those assets today, is going to court
June 15 to acquire the properties in Michigan's Oakland, Macomb
and St. Clair counties, including 10 wells and an oil storage
facility.

The receiver was appointed by court order March 30 and soon
discovered title to the most valuable of the remaining company
assets is still held by Onco USA, the report discloses.

The report notes that Onco was forced into receivership by secured
creditor Energex Petroleum, a company formed by Bilodeau and
others as a lender of last resort in late 2008 when banks gave up
on Onco.  Energex lent nearly US$1 million to Onco before pulling
the plug when it realized Onco, with nothing left in corporate
coffers, could not continue its plan to exploit abandoned oil and
natural gas reserves across Southwestern Ontario and Michigan, the
report recounts.

Trading in Onco shares was suspended after a bit more than six
months on the stock exchange for failure to file required
financial reports, the report notes.

In all, about 1,200 investors put more than US$30 million into
Onco, but shareholders have been warned by Bilodeau they will
likely see nothing from the receivership, the report states.

Onco Petroleum is based in London.


SANDWELL COMMERCIAL: Fitch Affirms 'CCC' Rating on Class E Notes
----------------------------------------------------------------
Fitch Ratings has downgraded and affirmed Sandwell Commercial
Finance No.1 plc, Sandwell Commercial Finance No.2 plc and
Sandwell Commercial Finance No.3 Limited's mortgage-backed
floating rate notes as detailed below:

Sandwell 1 FRN due 2039:

  -- GBP68.7m class A (XS0191369221) affirmed at 'AAA'; Outlook
     Stable

  -- GBP17.5m class B (XS0191371391) affirmed at 'AA'; Outlook
     Stable

  -- GBP12.5m class C (XS0191372522) affirmed at 'A'; Outlook
     revised to Negative from Stable

  -- GBP10m class D (XS0191373686) downgraded to 'BB' from 'BBB';
     Outlook Negative

  -- GBP5m class E (XS0191373926) downgraded to 'B' from 'BB';
     Outlook Negative

Sandwell 2 FRN due 2037:

  -- GBP172.0m class A (XS0229030126) affirmed at 'AAA'; Outlook
     Stable

  -- GBP16.3m class B (XS0229030472) affirmed at 'AA'; Outlook
     Stable

  -- GBP14.8m class C (XS0229030712) affirmed at 'A'; Outlook
     revised to Negative from Stable

  -- GBP18.8m class D (XS0229031017) downgraded to 'BB' from
     'BBB'; Outlook Negative

  -- GBP12.1m class E (XS0229031280) downgraded to 'B' from 'BB';
     Outlook Negative

Sandwell 3 FRN due 2032:

  -- GBP96.1m class A1 (XS0357081032) affirmed at 'AAA'; Outlook
     Negative

  -- GBP14.7m class A2 (XS0357081206) affirmed at 'AA'; Outlook
     Negative

  -- GBP3.6m class A3 (XS0357088631) affirmed at 'AA-'; Outlook
     Negative

  -- GBP19.2m class B (XS0357088987) affirmed at 'BBB'; Outlook
     Negative

  -- GBP10.2m class C (XS0357089100) downgraded to 'BB' from
     'BB+'; Outlook Negative

  -- GBP12.6m class D (XS0357089365) downgraded to 'B' from 'B+';
     Outlook Negative

  -- GBP10.8m class E (XS0357089951) affirmed at 'CCC'; Recovery
     Rating 'RR5'

The rating actions reflect Fitch's assessment of the impact of
current market conditions on the loans securitized in the
transactions.  For all three transactions, Fitch used portfolio-
level information to estimate the expected change in reported
market values based on the timing of the valuations and market
indices of capital values.

At the May 2010 interest payment date, only 45% of the original
note issuance in Sandwell 1 remained outstanding.  Principal
continues to be applied to the notes sequentially, periodically
increasing the available credit enhancement, primarily because the
reserve account is no longer fully funded.  Drawings totaling
GBP1.5 million were required following interest and principal
shortfalls on the largest loan in the transaction, prior to and
upon its redemption in February 2010.  Excess spread of
GBP0.1 million was used to partially replenish the reserve account
in May 2010.  The most recent WA reported loan-to-value ratio was
78% (scheduled to amortize to 58% at exit), predominantly based on
valuations conducted between 2000 and 2006.  Fitch estimates that
Sandwell 1 is likely to have suffered an overall market value
decline of approximately 13%, resulting in a WA Fitch LTV of 88%
(66% at exit).  The downgrade of the junior notes reflects the
increased likelihood of a loss to the junior notes, particularly
given the partially depleted reserve account, as borrowers may
struggle to repay facilities with LTV ratios in excess of 100%.

The MVD in Sandwell 2 is estimated at 8%, resulting in a WA Fitch
LTV of 96% (78% at exit).  The WA LTV, following the revaluation
of almost 50% of the portfolio by loan balance conducted during
the course of 2009, was reported at 88% in March 2010 compared to
74% in March 2009.  As with Sandwell 1, Sandwell 2 has amortized
significantly since closing, increasing the credit enhancement for
each class of notes.  Approximately 2% of the pool is in technical
default and an additional eight loans have matured.  Furthermore,
almost 20% of the pool by current balance is due to mature in the
next 18 months.  Fitch understands that the servicer is
undertaking negotiations to achieve the best exit strategy for
each of these loans, although the agency anticipates that the
repayment of some of the facilities may prove to be difficult, and
some losses may crystallize in the short-to-medium term.  The deal
benefits from a GBP7m reserve fund providing credit enhancement as
well as approximately GBP0.2m of excess spread per quarter, but
the balloon risk remains the main driver for the rating actions.

The pool for the most recent transaction, Sandwell 3, has also
amortized significantly since closing.  In March 2009, the second-
largest loan of the pool (15% of the original balance) was
repurchased following a breach of the seller mortgage sale
warranty.  In the IPD ending in March 2010, three additional loans
totaling GBP13.9 million were also prepaid.  Following the re-
valuations conducted for 20 properties during the course of 2009,
the WA reported LTV has increased to 86% from 74% as reported in
March 2009.  Notwithstanding, for a significant proportion of the
collateral the valuations still date back to the height of the
recent property market boom.  Consequently Fitch estimates that,
on average, the collateral value has declined by approximately
20%, resulting in a WA Fitch LTV of 108%.  The magnitude of the
estimated MVD, the absence of excess spread trapping to preserve
credit enhancement and the impact of the MVD on expected loan
recoveries is the key driver of the downgrade of Sandwell 3's
junior notes.


===============
X X X X X X X X
===============


* BOND PRICING: For the Week May 17 to May 21, 2010
---------------------------------------------------

Issuer              Coupon   Maturity Currency  Price
------              ------   -------- --------  -----

AUSTRIA
-------
BA CREDITANSTALT      5.470  8/28/2013    EUR    72.50
KOMMUNALKREDIT        4.900  6/23/2031    EUR    44.38
KOMMUNALKREDIT        5.430  2/13/2024    EUR    55.88
KOMMUNALKREDIT        6.460  3/27/2022    EUR    63.50
OESTER VOLKSBK        5.270   2/8/2027    EUR    98.02

BELGIUM
-------
FORTIS BANK           8.750  12/7/2010    EUR    15.34

CYPRUS
------
INTERPIPE LTD         8.750   8/2/2010    USD    77.49

FINLAND
-------
MUNI FINANCE PLC      0.250  6/28/2040    CAD    20.79
MUNI FINANCE PLC      0.500  3/17/2025    CAD    44.35
MUNI FINANCE PLC      1.000  2/27/2018    AUD    64.71
MUNI FINANCE PLC      0.500  9/24/2020    CAD    58.51

FRANCE
------
AIR FRANCE-KLM        4.970   4/1/2015    EUR    13.09
ALCATEL SA            4.750   1/1/2011    EUR    16.19
ALCATEL-LUCENT        5.000   1/1/2015    EUR     3.07
ALTRAN TECHNOLOG      6.720   1/1/2015    EUR     4.78
ATOS ORIGIN SA        2.500   1/1/2016    EUR    50.80
CALYON                6.000  6/18/2047    EUR    49.80
CAP GEMINI SOGET      1.000   1/1/2012    EUR    43.61
CAP GEMINI SOGET      3.500   1/1/2014    EUR    42.72
CLUB MEDITERRANE      4.375  11/1/2010    EUR    49.24
EURAZEO               6.250  6/10/2014    EUR    56.62
FAURECIA              4.500   1/1/2015    EUR    19.33
GROUPE VIAL           2.500   1/1/2014    EUR    18.15
MAUREL ET PROM        7.125  7/31/2014    EUR    16.86
NEXANS SA             4.000   1/1/2016    EUR    61.22
PEUGEOT SA            4.450   1/1/2016    EUR    28.28
PUBLICIS GROUPE       1.000  1/18/2018    EUR    46.31
PUBLICIS GROUPE       3.125  7/30/2014    EUR    36.50
RHODIA SA             0.500   1/1/2014    EUR    44.79
SOC AIR FRANCE        2.750   4/1/2020    EUR    19.78
SOITEC                6.250   9/9/2014    EUR     9.49
TEM                   4.250   1/1/2015    EUR    52.12
THEOLIA               2.000   1/1/2014    EUR    12.90
VALEO                 2.375   1/1/2011    EUR    46.45
ZLOMREX INT FIN       8.500   2/1/2014    EUR    46.88
ZLOMREX INT FIN       8.500   2/1/2014    EUR    46.88

GERMANY
-------
DEUTSCHE BK LOND      3.000  5/18/2012    CHF    64.50
DZ BANK AG            6.350   4/9/2018    EUR   117.23
ESCADA AG             7.500   4/1/2012    EUR    16.74
EUROHYPO AG           5.000  5/15/2027    EUR    94.13
HSH NORDBANK AG       4.375  2/14/2017    EUR    67.46
L-BANK FOERDERBK      0.500  5/10/2027    CAD    46.89
QIMONDA FINANCE       6.750  3/22/2013    USD     3.50
RENTENBANK            1.000  3/29/2017    NZD    71.50
SOLON AG SOLAR        1.375  12/6/2012    EUR    37.30

GREECE
------
HELLENIC REP I/L      2.300  7/25/2030    EUR    55.44
HELLENIC REP I/L      2.900  7/25/2025    EUR    54.63
HELLENIC REPUB        5.000  8/22/2016    JPY    73.01
HELLENIC REPUB        5.000  3/11/2019    EUR    73.70
HELLENIC REPUB        5.000  8/22/2016    JPY    72.14
HELLENIC REPUB        5.200  7/17/2034    EUR    70.38
HELLENIC REPUBLI      5.300  3/20/2026    EUR    73.32
HELLENIC REPUBLI      4.700  3/20/2024    EUR    72.33
HELLENIC REPUBLI      4.500  9/20/2037    EUR    60.76
HELLENIC REPUBLI      4.600  9/20/2040    EUR    60.56
YIOULA GLASSWORK      9.000  12/1/2015    EUR    54.88
YIOULA GLASSWORK      9.000  12/1/2015    EUR    57.00

IRELAND
-------
ALLIED IRISH BKS      5.250  3/10/2025    GBP    61.84
DEPFA ACS BANK        1.920   5/9/2020    JPY    71.24
DEPFA ACS BANK        4.900  8/24/2035    CAD    70.99
DEPFA ACS BANK        5.250  3/31/2025    CAD    75.20
DEPFA ACS BANK        0.500   3/3/2025    CAD    32.63
DEPFA ACS BANK        5.125  3/16/2037    USD    69.47
DEPFA ACS BANK        5.125  3/16/2037    USD    69.63
IRISH NATIONWIDE      6.250  6/26/2012    GBP   104.31
ONO FINANCE II        8.000  5/16/2014    EUR    74.00
ONO FINANCE II        8.000  5/16/2014    EUR    74.00
UT2 FUNDING PLC       5.321  6/30/2016    EUR    70.69

ITALY
-----
BANCA INTESA SPA      6.984   2/7/2035    EUR    73.13

LUXEMBOURG
----------
ARCELORMITTAL         7.250   4/1/2014    EUR    29.43
BREEZE FINANCE        4.524  4/19/2027    EUR    68.75
GALLERY CAPITAL      10.125  5/15/2013    USD    19.95
GLOBAL YATIRIM H      9.250  7/31/2012    USD    68.63
LIGHTHOUSE INTL       8.000  4/30/2014    EUR    61.49
LIGHTHOUSE INTL       8.000  4/30/2014    EUR    60.75

NETHERLANDS
-----------
AI FINANCE B.V.      10.875  7/15/2012    USD    72.75
APP INTL FINANCE     11.750  10/1/2005    USD     0.08
BK NED GEMEENTEN      0.500  6/27/2018    CAD    73.53
BK NED GEMEENTEN      0.500  2/24/2025    CAD    51.17
BLT FINANCE BV        7.500  5/15/2014    USD    69.50
BLT FINANCE BV        7.500  5/15/2014    USD    69.13
BRIT INSURANCE        6.625  12/9/2030    GBP    70.90
DGS INTL FIN BV      10.000   6/1/2007    USD     0.01
ELEC DE CAR FIN       8.500  4/10/2018    USD    48.13
EM.TV FINANCE BV      5.250   5/8/2013    EUR     5.42
NATL INVESTER BK     25.983   5/7/2029    EUR    46.77
NED WATERSCHAPBK      0.500  3/11/2025    CAD    50.11
NED WATERSCHAPBK      6.000  6/30/2045    EUR    73.23
Q-CELLS INTERNAT      5.750  5/26/2014    EUR    55.26
Q-CELLS INTERNAT      1.375  2/28/2012    EUR    57.31
RBS NV EX-ABN NV      2.910  6/21/2036    JPY    71.06
RBS NV EX-ABN NV      7.540  6/29/2035    EUR    72.84
TEMIR CAPITAL         9.500  5/21/2014    USD    33.00
TURANALEM FIN BV      8.000  3/24/2014    USD    50.21
TURANALEM FIN BV      7.875   6/2/2010    USD    44.00
TURANALEM FIN BV      6.250  9/27/2011    EUR    44.46
TURANALEM FIN BV      7.750  4/25/2013    USD    45.90
TURANALEM FIN BV      8.250  1/22/2037    USD    46.69
TURANALEM FIN BV      8.500  2/10/2015    USD    47.08
TURANALEM FIN BV      8.000  3/24/2014    USD    43.40

NORWAY
------
EKSPORTFINANS         0.500   5/9/2030    CAD    40.63
NORSKE SKOGIND        7.000  6/26/2017    EUR    61.80
RENEWABLE CORP        6.500   6/4/2014    EUR    72.17

POLAND
------
REP OF POLAND         3.300  6/16/2038    JPY    68.46
REP OF POLAND         3.220   8/4/2034    JPY    73.48
REP OF POLAND         2.648  3/29/2034    JPY    64.57

RUSSIA
------
IKS 5 FINANS          7.600   7/1/2014    RUB   100.11

SPAIN
-----
BANCAJA EMI SA        2.755  5/11/2037    JPY    36.41
CYTOS BIOTECH         2.875  2/20/2012    CHF    70.50

SWITZERLAND
-----------
UBS AG               13.300  5/23/2012    USD     3.46
UBS AG JERSEY         9.000  6/11/2010    USD    53.03
UBS AG JERSEY         3.220  7/31/2012    EUR    48.95
UBS AG JERSEY         9.450  9/21/2011    USD    48.71
UBS AG JERSEY         9.350  9/21/2011    USD    61.02
UBS AG JERSEY        11.150  8/31/2011    USD    39.45
UBS AG JERSEY        10.360  8/19/2011    USD    54.38
UBS AG JERSEY        13.000  6/16/2011    USD    50.87
UBS AG JERSEY        10.650  4/29/2011    USD    15.88
UBS AG JERSEY        11.030  4/21/2011    USD    21.12
UBS AG JERSEY        10.820  4/21/2011    USD    21.95
UBS AG JERSEY        16.160  3/31/2011    USD    44.96
UBS AG JERSEY        10.990  3/31/2011    USD    30.99
UBS AG JERSEY        11.400  3/18/2011    USD    25.67
UBS AG JERSEY        11.330  3/18/2011    USD    18.08
UBS AG JERSEY        12.800  2/28/2011    USD    34.46
UBS AG JERSEY        11.000  2/28/2011    USD    67.55
UBS AG JERSEY        15.250  2/11/2011    USD    11.42
UBS AG JERSEY        10.000  2/11/2011    USD    61.78
UBS AG JERSEY        16.170  1/31/2011    USD    12.83
UBS AG JERSEY        14.640  1/31/2011    USD    38.31
UBS AG JERSEY        13.900  1/31/2011    USD    35.92
UBS AG JERSEY         9.500  8/31/2010    USD    58.95
UBS AG JERSEY         9.000  8/13/2010    USD    57.40
UBS AG JERSEY         9.350  7/27/2010    USD    53.35
UBS AG JERSEY         9.000  7/19/2010    USD    52.80
UBS AG JERSEY         9.000   7/2/2010    USD    53.10
UBS AG LONDON        12.210  6/28/2010    EUR    73.10
UBS AG LONDON        17.550  6/28/2010    EUR    73.28
UBS AG LONDON        17.350  6/28/2010    EUR    73.32
UBS AG LONDON        17.000  6/28/2010    EUR    73.25
UBS AG LONDON        16.430  6/28/2010    EUR    73.22

UNITED KINGDOM
--------------
BANK OF SCOTLAND      6.984   2/7/2035    EUR    71.17
BANK OF SCOTLAND      2.359  3/27/2029    JPY    73.04
BARCLAYS BK PLC      10.650  1/31/2012    USD    44.80
BARCLAYS BK PLC       8.550  1/23/2012    USD    11.55
BARCLAYS BK PLC       7.610  6/30/2011    USD    53.15
BARCLAYS BK PLC      10.600  7/21/2011    USD    41.27
BARCLAYS BK PLC       9.000  6/30/2011    USD    44.71
BRADFORD&BIN BLD      4.910   2/1/2047    EUR    61.83
BRADFORD&BIN BLD      5.500  1/15/2018    GBP    32.55
BRADFORD&BIN PLC      6.625  6/16/2023    GBP    29.46
BRADFORD&BIN PLC      7.625  2/16/2049    GBP    37.08
BROADGATE FINANC      5.098   4/5/2033    GBP    72.05
CO-OPERATIVE BNK      5.875  3/28/2033    GBP    76.78
EFG HELLAS PLC        6.010   1/9/2036    EUR    29.50
EFG HELLAS PLC        4.375  2/11/2013    EUR    74.51
ENTERPRISE INNS       6.375  9/26/2031    GBP    75.75
HBOS PLC              4.500  3/18/2030    EUR    73.92
INEOS GRP HLDG        8.500  2/15/2016    USD    73.08
INEOS GRP HLDG        7.875  2/15/2016    EUR    72.88
INEOS GRP HLDG        7.875  2/15/2016    EUR    73.24
LBG CAPITAL NO.1      7.975  9/15/2024    GBP    76.00
LBG CAPITAL NO.1      6.439  5/23/2020    EUR    75.58
LBG CAPITAL NO.2      6.385  5/12/2020    EUR    75.46
NATL GRID GAS         1.771  3/30/2037    GBP    46.73
NBG FINANCE PLC       2.755  6/28/2035    JPY    37.53
NORTHERN ROCK         4.574  1/13/2015    GBP    71.88
OJSC BANK NADRA       9.250  6/28/2010    USD    32.50
PIRAEUS GRP FIN       4.000  9/17/2012    EUR    71.38
PUNCH TAVERNS         6.468  4/15/2033    GBP    71.77
ROYAL BK SCOTLND      4.243  1/12/2046    EUR    70.19
TXU EASTERN FNDG      6.450  5/15/2005    USD     1.00
TXU EASTERN FNDG      6.750  5/15/2009    USD     2.38
UNIQUE PUB FIN        6.464  3/30/2032    GBP    67.50
WESSEX WATER FIN      1.369  7/31/2057    GBP    23.21


                            *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable.  Those sources may not,
however, be complete or accurate.  The Monday Bond Pricing table
is compiled on the Friday prior to publication.  Prices reported
are not intended to reflect actual trades.  Prices for actual
trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than US$3 per
share in public markets.  At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled.  Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets.  A company may establish reserves on its balance sheet for
liabilities that may never materialize.  The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in each
Thursday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged.  Send announcements to
conferences@bankrupt.com

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals.  All titles are
available at your local bookstore or through Amazon.com.  Go to
http://www.bankrupt.com/booksto order any title today.

                            *********


S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter -- Europe is a daily newsletter co-
published by Bankruptcy Creditors' Service, Inc., Fairless
Hills, Pennsylvania, USA, and Beard Group, Inc., Frederick,
Maryland USA.  Joy A. Agravante, Valerie U. Pascual, Marites O.
Claro, Rousel Elaine T. Fernandez, Frauline S. Abangan and Peter
A. Chapman, Editors.

Copyright 2010.  All rights reserved.  ISSN 1529-2754.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers.

Information contained herein is obtained from sources believed to
be reliable, but is not guaranteed.

The TCR Europe subscription rate is US$625 per half-year,
delivered via e-mail.  Additional e-mail subscriptions for members
of the same firm for the term of the initial subscription or
balance thereof are US$25 each.  For subscription information,
contact Christopher Beard at 240/629-3300.


                 * * * End of Transmission * * *